- A federal judge issued a confiscation warrant for about 392 bitcoin worth about $ 16 million that belonged to a group of darknet drug dealers, according to US lawyers.
- US attorneys said the owners bought a Triumph fishing boat and California squid permit in 1974 to “hide and disguise” drug money.
- Bitcoin’s value is more than ten times what it was in January 2019 when it was found while searching for a house in Ventura, California, according to a complaint.
A federal judge issued a confiscation warrant for about 392 bitcoin worth about $ 16 million that belonged to a group of darknet drug dealers, according to US lawyers.
The Bitcoin has been held by US marshals since 2019, along with an old fishing boat and a permit to catch octopus. This emerges from a revocation complaint filed with the district court on December 29th. Lawyers said a group of darknet drug dealers kept much of their money in Bitcoin, laundering $ 600,000 by buying a California octopus permit and a 1974 Triumph fishing vessel.
The 391.5873617 Bitcoin was worth about $ 16 million on Sunday morning, more than ten times what it was when it was discovered in a raid in Ventura, California in 2019. The owners, whom lawyers said had been arrested, have not been identified The foreclosure, bitcoin, permit and boat are listed as “defendants”.
“The defendants are in the custody of the United States Marshals Service in this district, where they remain under the jurisdiction of this court while this lawsuit is pending,” the file states.
The Justice Department attorneys who filed the complaint did not respond to a request for additional information on the forfeiture motion, the raid, or the defendants.
As tax officials put in place new anti-money laundering regulations across Bitcoin and other cryptocurrencies, the case is a reminder that some treat the currencies in a similar way to cash. Bitcoin can be stowed in a house, and $ 16 million worth of bitcoin fits in a wallet.
Continue reading: “This is madness”: Andreessen Horowitz and Fred Wilson blow up the Trump administration and say they are trying to “squeeze” new and “flawed” crypto rules in the 11th hour. Without further information, it is difficult to say exactly how the bitcoin was stored. but it seems clear that it was in a wallet to keep it offline. Lawyers described it as a “cold store” wallet. Earlier this month, Square CEO Jack Dorsey, a vocal Bitcoin owner and promoter, released a guide on how to set up a similar offline wallet. – Jack (@jack) January 3, 2021
When the darknet Bitcoin was seized by federal agents in January 2019, the price of Bitcoin was around $ 3,400. When the U.S. District Court for the Central District of California issued its arrest warrant on Monday, Bitcoin was above $ 30,000, despite briefly falling below that mark. By Friday, Bitcoin had risen above $ 41,000 for the first time.
The confiscated Bitcoin was earned through illegal drug sales on several darknet marketplaces, according to the forfeiture complaint.
According to the US attorneys, “The defendant Bitcoin was won on the darknet between 2016 and 2019 from the sale of illegal drugs, including fentanyl patches and opioids, which were dispensed on the darknet without a prescription.”
They added, “The seller started selling illegal prescription drugs on the darknet through several marketplaces including Dream, Silk Road, AlphaBay and Wall Street Market around 2014, and has been making approximately $ 250,000 worth of bitcoin from the illegal one every month as of 2014 Drug sales. “
Investigators made controlled purchases from dealers between December 2017 and May 2018 before searching the Ventura house on January 11, 2019, according to the complaint.
Following the raid, authorities said they found out that $ 600,000 worth of bitcoin had been converted into cash, according to US lawyers. To “hide and disguise” this, the dealers used the money to buy a 1974 Triumph fishing boat and a California Octopus permit from the Department of Fish and Wildlife, both of which are now federally owned.
The case, United States of America versus 391.5873617 in Bitcoin et al., Was assigned to District Judge Christina A. Snyder and Judge Jacquieline Chooljian last week. Snyder was appointed to the Bundesbank in 1997 by then President Bill Clinton.