Not too long ago, Live Bitcoin News reported that quite a bit of digital money associated with a Silk Road crypto account was moved around. More information has come in about the situation and we now have details that the money was seized by members of the U.S. government. Specifically, the Department of Justice.
More Details Regarding Silk Road Money Moving
The money was in the control of a hacker that the department is simply referring to as “Individual X.” While the agency is refusing to divulge the identity of the person in question, it appears he (or she) is cooperating with the Department of Justice and may even be a local resident of Northern California. The organization explained in a statement:
On approximately 23 April 2015, [the bitcoin account] sent 101 bitcoins (approximately $23,700 at that time) to BTC-e, a company that provided bitcoin-related services and operated as an unlicensed cryptocurrency exchange.
What’s significant about the money being sent to BTC-e? The fact that Alexander Vinnik – a man who allegedly worked as a technical advisor for the platform – is now on trial for stealing more than $100 million from customers that did business with the exchange. Many analysts are now wondering if there was some connection between the two, and if maybe Vinnik was potentially a member of Silk Road or part of its operations somehow.
US attorney David Anderson put in his two cents about the situation, explaining in an interview:
Silk Road was the most notorious online criminal marketplace of its day. The successful prosecution of Silk Road’s founder in 2015 left open a billion-dollar question: where did the money go? Today’s forfeiture complaint answers this open question at least in part. $1bn of these criminal proceeds are now in the United States’ possession.
The Department of Justice worked with Chainalysis to lock in on the hacker’s behavior and track down the money. Continuing its previous statement, the organization explained:
Individual X was able to hack into Silk Road and gain unauthorized and illegal access to Silk Road, and thereby steal the illicit cryptocurrency from Silk Road and move it into wallets that Individual X controlled. According to the investigation, [Ross Ulbricht, the now jailed founder of the site] became aware of Individual X’s online identity and threatened Individual X for return of the cryptocurrency to Ulbricht. Individual X did not return the cryptocurrency but kept it and did not spend it.
Proving the Origins of the Funds
While the Department of Justice has the digital money in its possession, it cannot automatically keep it. It must prove beyond reasonable doubt in a court of law that the money is subject to forfeiture proceedings, and that it did indeed stem from criminal actions.
Ross Ulbricht – the man behind the Silk Road dark site – is presently serving a life sentence for his role in its development.