Key takeaways
- The US authorities has begun liquidating the bitcoins seized from Silk Highway embezzler James Zhong.
- DOJ had already offered 9,861 BTC on March 14, incomes $215.5 million.
- It plans to promote the remaining 41,490 BTC in 4 installments over the course of the yr.
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On-chain analysts famous earlier within the month that the US authorities was shifting funds seized from Silk Highway embezzler James Zhong. It seems that the DOJ was maneuvering to promote a few of the storage.
Dumping Silk Highway Bitcoin
The US authorities is promoting a few of its bitcoin holdings.
A brand new submitting from the USA Division of Justice Suggests A number of the bitcoins seized by authorities from Silk Highway exploiter James Zhong have already been offered.
In accordance with the doc, the federal government as soon as held a complete of 51,351 BTC (value about $1.4 billion at at this time’s costs) in reference to the Silk Highway — most of which got here from Zhong. Of those holdings, 9,861 BTC have been offered on March 14, incomes the DOJ greater than $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 tranches over the course of the calendar yr—although it’ll wait till Zhong is sentenced to liquidate the second batch.
Zhong is accused of defrauding the darknet market Silk Highway in September 2012 utilizing the platform’s withdrawal mechanism. US authorities have been in a position to seize Zhong’s stash of fifty,676 BTC in November 2021. Zhong admitted the crime to 1 depend of wire fraud in November 2022. Though he confronted as much as 20 years in jail, he lately requested the court docket to spare him jail time due to his tough childhood, autism and his lack of legal convictions. He’s scheduled to be sentenced on April 14.
It’s extremely probably that the federal government used Coinbase to promote its 9,861 BTC. On-chain analyzers famous Round 49,000 BTC in wallets related to the seized Silk Highway funds have been moved to numerous new addresses in early March. Considered one of these addresses was recognized as belonging to crypto change Coinbase; He acquired 9,825 BTC on March 7.
The DOJ’s use of Coinbase is atypical, as the federal government has traditionally chosen to liquidate seized digital belongings via public auctions.
Disclosure: On the time of writing, the writer of this piece held BTC, ETH and several other different crypto belongings.
