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In 2013, the U.S. government discovered the secret illegal website (Silk Road) created by Ross Ulbricht under the nickname Pirate Roberts. The US government seized a massive amount of Bitcoin worth billions of dollars after the government accused Ulbricht of using his website for drugs and several illegal substance transactions.

Although thousands of seized Bitcoin have been auctioned over the past few years, a significant amount remains in the custody of law enforcement agencies in the United States. On the 8th of March 2023, over $1 billion worth of BTC was transferred from various digital wallets in the custody of U S law enforcement agencies to Coinbase and some other wallets.

Information from blockchain security leader PeckShield revealed that digital assets were transferred from the wallet of US law enforcement three times. The three wallets contained over 50K BTCs that were confiscated in 2021.

Over 9K BTC was sent to the custody of Coinbase, while most of the remaining BTC was transferred to internal wallets. Aside from over 9K BTC that was transferred to Coinbase, 30K BTC and 9K BTC were also transferred to other wallets.

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The Silk Road BTC Seizure

In an auction of some Bitcoins confiscated from the Silk Road, American venture capitalist Draper Fisher Jurvetson purchased over 25K BTC in 2014. The United States marshals service auctioned over 2K BTC in 21 blocks the following year.

Then, an additional 2.3K BTC in one block was also auctioned. Although the United States law enforcement agency only transferred about 20% of the seized BTC to Coinbase, the transaction has led to various speculations from Twitter users.

A Twitter user referred to the US government as taking possession of a “measly collection.” Some Twitter analysts challenged US law enforcement’s decision to sell the confiscated Bitcoin at this time of the year.

A Bitcoin enthusiast on Twitter insisted that selling Silk Road’s digital assets will put unnecessary pressure on the Bitcoin market. The Silk Road was a secret commercial website that operated for two years between 2011 and 2013.

It was infamous for being used by several drug barons who used the website to initiate and complete various illegal transactions while making payments in BTC. Meanwhile, Ulbricht continues to serve life imprisonment for creating this website.

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George Ward

By George Ward

George Ward is a crypto journalist and market analyst at Herald Sheets, known for his engaging articles on the latest digital currency trends. With a background in finance and journalism, he presents complex topics accessibly. George holds a degree in Business and Finance from the University of Cambridge.