On the darknet, Bitcoin is a rather commonly accepted payment method in this day and age. Because of law enforcement agencies cracking down on these users, they have also confiscated a fair amount of Bitcoin in the process. Roughly $4m worth of BTC has been auctioned off on November 5.
Another US Marshal Bitcoin Auction
One has to commend the US Marshals and other law enforcement agencies for bringing an end to illegal darknet sales. These underground marketplaces allow anyone in the world to buy or sell any good or service one can think of. More often than not, those services rendered are completely illegal, which means law enforcement needs to intervene at the appropriate time.
In recent years, numerous darknet vendors have been arrested. While the arrest itself is the “big victory” for law enforcement, they also succeed in confiscating assets associated with this illegal operation. In most cases, either drugs or firearms are seized. However, the US Marshals also confiscate Bitcoin wallets on a regular basis. That is only normal, as Bitcoin remains the most popular payment method on the darknet.
To put this in perspective, the US Marshals have confiscated over $4m worth of Bitcoin in recent months. As is usually the case, that funds cannot be kept in their custody for an extended period of time. As such, the US Marshals auctioned off these Bitcoin holdings on November 5 to the highest bidder.
It is not the first time such an auction takes place. When Silk Road was shut down, the confiscated Bitcoin assets were auctioned off to the highest bidder. At that time, Tim Draper began paying a lot of attention to Bitcoin, as he managed to buy significant quantities for very low prices. It is certainly possible history will repeat itself in this regard.
Similar to previous Bitcoin auctions, interested parties can partake through “sealed bids”. This will ensure all information is kept confidential at all times. One downside is how the bidders are unable to change their bid after submitting it. Those who partake will also need to deposit $200,00 on beforehand. Those who don’t win the auction will receive their deposit back afterward.
Earlier this year, another Bitcoin auction by the US Marshals netted over $50m. That was during a time when one Bitcoin was valued at over $15,000, over twice the value it has today. As such, it seems safe to assume nearly 7,000 BTC will be auctioned off next week. How much bidders will eventually pay for this purse, remains to be determined.