Silk Road founder loses more than $3 billion in bitcoin to federal government

Not too often a billion dollars is ceded to the federal government. Ross UlbrichtThe founder of Silk Road, he recently lost several billion dollars Bitcoin Along with additional crypto assets of the United States federal government. A court filing revealed that Ulbricht handed over 69,000 Bitcoins along with Bitcoin Cash, Bitcoin SV and Bitcoin Gold to the federal government to meet the terms of the settlement. All in all, the cryptocurrency holdings add up to $3 billion.

How did the confiscation come about?

The massive amount of cryptocurrency was initially seized by the US Department of Justice in the winter of 2020. The cryptocurrency was initially taken from a person referred to as “Individual X” after he allegedly stole funds from the Silk Road two years ago to those the point. According to the IRS criminal investigation team, the unnamed individual stole bitcoin from Silk Road while the site was still alive. The theft occurred as a result of a digital security error.

Court affidavits show that Ulbricht issued threats to an unknown person in an effort to get the money back. Although the anonymous person has held the cryptocurrency for nearly a decade, the IRS tracked down the funds, identified the individual, and filed for a deal to confiscate the funds rather than face criminal prosecution.

The terms of Ulbricht’s settlement stipulate that he will confiscate the Bitcoin and Bitcoin variants to the Department of Justice in exchange for canceling his debts. Bitcoin will be sold at auction. The founder of Silk Road is now withdrawing all claims to Bitcoin, stipulating that the now confiscated property belongs to the United States federal government. Moreover, the net proceeds from the sale of the cryptocurrency will meet the unpaid balance of the monetary judgment obtained against Ulbricht.

According to The Block, the Bitcoin auction will likely be similar to the one conducted by the General Services Administration. The confiscated Bitcoin is expected to be auctioned to interested buyers. As most cryptocurrency investors know, Bitcoin has increased in value exponentially since Ulbricht initially used it on his illegal black market platform.

Ulbricht’s statue details

The digital criminal, formerly referred to as “Dread Pirate Roberts,” is now in the midst of a life sentence and 40 years without the possibility of parole after releasing Silk Road, an illegal black market site for criminal activity. Silk Road closed in 2015.

It is interesting to note that Ulbricht lodged an appeal against the court’s decision. The appeal was rejected. Furthermore, the digital criminal sought a pardon from then-President Trump. Trump refused the pardon. As a result, there is a high probability that Ulbricht will spend the rest of his life in prison.

The Ulbricht family speaks

It is interesting to note that Ulbricht’s mother gave an interview to Wired, saying that the Ulbricht family was satisfied with the settlement and hoped that her son would eventually be released. She also noted that the false charges against her son were dropped following a federal trial. Ulbricht’s mother has also stated that she believes her son will eventually be released and make meaningful contributions to the world. However, most legal analysts would disagree. Ulbricht’s arbitrary violation of the law when operating a black market to buy and sell illegal goods warrants a life sentence. As of April 2024, Ulbricht has spent eight years in prisons in Arizona, Colorado, and New York.

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