The United States Department of Justice (DOJ) has received the green light to sell 69,370 Bitcoins seized from Silk Road, a former darknet marketplace active between 2011 and 2013. This “heist of the century” known for illegal activities like drug or arms trafficking remains a significant episode in the history of Bitcoin. The value of these assets is estimated at around $6.5 billion according to CoinGecko. This sale could well become a key event for the crypto market at the start of the year. We take stock.
- The United States Department of Justice has obtained authorization to sell 69,370 Bitcoins seized from Silk Road.
- The value of these Bitcoins has been estimated at around $6.5 billion, promising a potential impact on the crypto market.
Bitcoin: a legal decision that affects the crypto market
On December 30, 2024, a federal judge approved the DOJ’s request to sell the 69,370 BTC seized in connection with Silk Road, the infamous darknet marketplace. The decision ends years of disputes over the ownership of confiscated assets. This request dates back to a decision of the Supreme Court dating from October 2024
In details, Battle Born Investmentsan entity claiming ownership of the funds, argued that these bitcoins were part of a succession of assets liquidated to repay creditors. The company also sought to identify the individual who initially handed over the bitcoins to the government, “Individual X”, via a Freedom of Information Act (FOIA) request, hoping to strengthen their claim. These efforts were rejected by the courtswho have validated the liquidation planned by the DOJ.
A sale justified by the volatility of the crypto market
According to court documents, the DOJ cited the high price volatility of Bitcoin to justify a rapid liquidation. The stated objective is to prevent any potential loss of value in the event of significant market fluctuations.
“The government will move forward in accordance with this judicial decision,” declared a DOJ spokesperson. The sale will be supervised by theUS Marshals Servicewhich traditionally handles sales of seized assets by holding public auctions to sell these confiscated assets, as has been the case in other large sales of Bitcoin from criminal cases.
This liquidation will represent theone of the largest sales of seized cryptocurrencies in history. For comparison, in 2021, the American authorities had sold more than 50,000 BTC seized during the hacker James Zhong affair, a lot then estimated at $1 billion as we explain in detail in this article.
A historical precedent for Bitcoin
The announcement of the sale has already had a impact on the market. Data from CoinGecko shows that BTC rose from a price of $95,000 to $93,800 in the hours following the decision, before stabilizing around 94 300 dollars. This market reaction, sensitive to government announcements, could be explained by the fear of excessive supply, to which is added uncertainty as to the impact of a potential massive liquidation on investor confidence.
Among these analysts, Peter Schiff, as usual, does not go unnoticed. The economist, known for his skepticism of Bitcoin, reacted to the announcement by saying that this massive sell-off is a reminder of the “inherent risks” of Bitcoin.
“The cryptocurrency market remains very volatile, and these government sales only highlight the structural instability of this asset”
Source : X
This sale recalls another recent example: the German government’s liquidation of Bitcoins seized in a criminal case. However, the timing of this sale proved unfavorable, with Bitcoin surging to $100,000 shortly after, resulting in a loss of value for the state.
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