Thousands of BTC were seized from Silk Road by US law enforcement over the years, and some were auctioned from time to time.
Over 50,000 Bitcoins
A total of $1 billion, allegedly related to US government law enforcement crimes, was taken from multiple wallets and transferred to new addresses, some of which were transferred to Coinbase on March 8.
According to data shared by chain analytics company PeckShield, three transfers were made from US law enforcement wallets. US agencies seized these wallets with approximately 51,000 BTC from the Silk Road marketplace in November 2021. The seized BTC was deposited into two wallet addresses.
Most of these three transfers appear to be internal transfers. However, about 9,861 BTC was sent to Coinbase. The other two involve a transfer of 30,000 BTC and 9,000 BTC.
Silk Road was an online black market and the first modern dark market. In 2011, it was started by an American founder, Ross Ulbricht, under the nickname “Dread Pirate Roberts”. The marketplace was one of the first to accept Bitcoin payments to promote the use of crypto. US law enforcement has seized many items from the founder, including BTC shares that were auctioned from time to time.
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Famous Bitcoin fan Tim Draper bought 30,000 BTC in one of these auctions in 2014. Another 50,000 BTC auction was held in October 2015, when the US Marshals Service offered 21 blocks of 2,000 BTC and one block of 2,341 BTC in an online auction.
Although only a fraction of the 50,000 BTC was sent to Coinbase, the movement of billions of BTC in wallets linked to US regulators has sparked wild reactions and even wilder theories from Twitter users. One of the US agencies suggested that if Silk Road decided to sell Bitcoin, it would cause a lot of selling pressure in the market. Meanwhile, a few other people questioned the timing of the sale.