The U.S. Justice Department claimed the proceeds from the sale of 144,336 bitcoins, valued at over $48 million, that were recovered from Ross William Ulbricht’s laptop computer, after shutting down the online drug market Silk Road in 2013,
Ulbricht was found guilty in 2015, after a jury trial, of distributing narcotics, distributing narcotics by means of the Internet, conspiring to distribute narcotics, engaging in a continuing criminal enterprise, conspiring to commit computer hacking, conspiring to traffic in false identity documents, and conspiring to commit money laundering, in connection with his operation of the Silk Road underground website.
Ulbricht created Silk Road in January 2011, and owned and operated the underground website until it was shut down by law enforcement authorities in October 2013.
Silk Road emerged as the most sophisticated and extensive criminal marketplace on the Internet, serving as a sprawling black-market bazaar where unlawful goods and services, including illegal drugs of virtually all varieties, were bought and sold regularly by the site’s users. While in operation, Silk Road was used by thousands of drug dealers and other unlawful vendors to distribute hundreds of kilograms of illegal drugs and other unlawful goods and services to more than 100,000 buyers, and to launder hundreds of millions of dollars deriving from these unlawful transactions.
In connection with the investigation of Silk Road, the Government seized 144,336 Bitcoins derived from Silk Road’s illegal activities that were found on Ulbricht’s laptop computer. These Bitcoins were ultimately sold by the United States Marshals Service pursuant to Court order for $48,238,116.
The government had already sold the bitcoins in a series of auctions in 2014 and 2015, but the creator of Silk Road, Ross Ulbricht (aka “Dread Pirate Roberts”) had challenged the legality of the forfeiture.
Ulbricht, however, agreed to drop the claims, according to the office of Joon H. Kim, the Acting U.S. Attorney for the Southern District of New York—meaning the government could claim the proceeds.
The $48.2 million total proceeds means the US government sold the bitcoins for an average of $334.
The current price is above $5,000—meaning the Justice Department would have made better conversion had the sale taken place nowadays.