Feds lose $31 million from seized Silk Road Bitcoins

Home » Feds lose $31 million from seized Silk Road Bitcoins

bitcoin-wall4In October of last year, the FBI seized 144,336 Bitcoin from accounts belonging to the Silk Road black market site. By the start of 2014, those coins were valued at around $114 million. Unfortunately, Bitcoin’s value has taken quite a hit in recent months, resulting in a net loss to the Federal government of nearly $31 million.

The New York Post reports that the government had considered selling off the Bitcoin stash due to increased price volatility, but never moved forward with the sale.

Manhattan US Attorney Preet Bharara has yet to pull the trigger on the sale, a federal official confirmed.

Bharara’s office declined to comment on whether it plans to wait out the crypto-currency storm.”

The government’s Bitcoin supply is still worth an estimated $82.8 million. The FBI’s claim to the funds is challenged by Ross Ulbrich, the man the government claims is actually Silk Road administrator “Dread Pirate Roberts.” Ulbrich has requested the Bitcoins be converted to standard U.S. dollars to retain some of the value, although the impact of such a massive selloff would probably contribute to a further reduction of Bitcoin prices.

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