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Key Takeaways
The U.S. authorities has begun liquidating the bitcoin it seized from Silk Street exploiter James Zhong.
The DOJ already offered 9,861 BTC on March 14, netting $215.5 million.
It plans on promoting the remaining 41,490 BTC in 4 installments over the course of the 12 months.
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On-chain analysts observed initially of the month that the U.S. authorities was shifting funds it had seized from Silk Street exploiter James Zhong. It seems that the DOJ was maneuvering to promote a number of the stash.
Dumping Silk Street Bitcoin
The U.S. authorities is promoting a few of its bitcoin holdings.
A brand new submitting from america Division of Justice signifies that a number of the bitcoin seized by authorities from Silk Street exploiter James Zhong has already been offered.
In line with the doc, the federal government held at one level a complete of 51,351 BTC (value roughly $1.4 billion at right this moment’s costs) in connection to Silk Street—the vast majority of which got here from Zhong. Of those holdings, 9,861 BTC had been offered on March 14, netting the DOJ over $215.5 million. The submitting states that the federal government paid roughly $215,738 in charges for the transaction. It plans to promote the remaining 41,490 BTC ($1.1 billion) in 4 extra installments over the course of the calendar 12 months—although it would wait till Zhong’s sentencing to liquidate the second batch.
Zhong is accused of defrauding darknet market Silk Street by exploiting the platform’s withdrawal mechanism in September 2012. U.S. authorities managed to grab Zhong’s stash of fifty,676 BTC in November 2021. Zhong pleaded responsible to at least one rely of wire fraud in November 2022. Although he faces as much as 20 years in jail, he lately requested the courtroom to spare him jail time, on account of his tough childhood, autism, and the truth that his crime was victimless. He’s scheduled for sentencing on April 14.
It’s extremely doubtless that the federal government used Coinbase to promote its 9,861 BTC. On-chain analysts observed initially of March that wallets related to seized Silk Street funds had moved roughly 49,000 BTC to varied recent addresses. One in every of these addresses was recognized as belonging to crypto trade Coinbase; it acquired 9,825 BTC on March 7.
The DOJ’s use of Coinbase is atypical, as the federal government has traditionally most well-liked liquidating seized digital belongings via public auctions.
Disclosure: On the time of writing, the creator of this piece owned BTC, ETH, and several other different crypto belongings.
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