DOJ Cleared To Sell $6.5 Billion In Bitcoin Seized From Silk Road (cryptobriefing.com) 63
An anonymous reader quotes a report from Crypto Briefing: The US Department of Justice (DOJ) has been authorized to sell approximately 69,370 Bitcoin seized in connection with the Silk Road darknet marketplace, a haul currently valued at around $6.5 billion, DB News reported Wednesday. The decision is set to end a years-long legal dispute over the BTC stash's ownership. On December 30, a federal judge ruled in favor of the DOJ's request to liquidate the crypto assets, the report said. Battle Born Investments, which had asserted a claim to the Bitcoin stash through a bankruptcy estate, ultimately failed in its bid to delay the sale.
As noted, the group had pursued a Freedom of Information Act (FOIA) request seeking the identity of "Individual X," who initially surrendered Bitcoin, but the effort also proved unsuccessful. Battle Born's legal counsel criticized the DOJ's handling of the case, alleging the department employed "procedural trickery" in its use of civil asset forfeiture to avoid scrutiny. The DOJ, in its arguments before the court, cited Bitcoin's price volatility as motivation for seeking a quick sale of the seized assets. A DOJ spokesperson, when contacted, stated, "The Government will proceed further consistent with the judgment in this case."
The update comes after the US Supreme Court refused to hear an appeal challenging the seizure of the Bitcoin stash, which was brought by Battle Born last October. The decision likely paved the way for the US government to sell Bitcoin, which was valued at $4.4 billion at the time. The US Marshals Service is expected to manage the liquidation process, which, if confirmed, will be one of the largest sales of seized crypto in history. Further reading: Judge Rejects Man From Retrieving $750 Million of Bitcoin From Landfill
As noted, the group had pursued a Freedom of Information Act (FOIA) request seeking the identity of "Individual X," who initially surrendered Bitcoin, but the effort also proved unsuccessful. Battle Born's legal counsel criticized the DOJ's handling of the case, alleging the department employed "procedural trickery" in its use of civil asset forfeiture to avoid scrutiny. The DOJ, in its arguments before the court, cited Bitcoin's price volatility as motivation for seeking a quick sale of the seized assets. A DOJ spokesperson, when contacted, stated, "The Government will proceed further consistent with the judgment in this case."
The update comes after the US Supreme Court refused to hear an appeal challenging the seizure of the Bitcoin stash, which was brought by Battle Born last October. The decision likely paved the way for the US government to sell Bitcoin, which was valued at $4.4 billion at the time. The US Marshals Service is expected to manage the liquidation process, which, if confirmed, will be one of the largest sales of seized crypto in history. Further reading: Judge Rejects Man From Retrieving $750 Million of Bitcoin From Landfill
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Would it not be socialism if the money went to US citizens?
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No. One pretty standard definition of socialism is
Any of various theories or systems of social organization in which the means of producing and distributing goods is owned collectively or by a centralized government that often plans and controls the economy.
This doesn't have anything to do with "the means of producing and distributing goods", so it's not socialism.
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I fear you have suffered a Class 1 Irony Failure.
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Go ahead, game that out. What was the irony?
The GP was obviously being sardonic, but this is orthogonal to the "socialism or not" axis. It was a dumb attempt at irony, but failed to land because -- like most attempts to defend socialism -- it was grossly ignorant.
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Public parks? Schools? Libraries? If you are so scared of a word you dont know what is behind it, then I suggest you not discuss it as if you know it.
Same as being against "Obamacare" and wanting to keep the ACA.
I argue those that are against socialism are more ignorant of what it consists of than those that joke about it. Because at least they know what it means.
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Any of various theories or systems of social organization in which the means of producing and distributing goods is owned collectively or by a centralized government that often plans and controls the economy.
If you're going to throw out that definition of socialism and use a different one, you're going to have to share it with the class; otherwise what you're saying is a non-sequitur at best, and intention equivocation at worst.
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Do you think public roads fall into the definition I quoted, which requires "the means of producing and distributing goods is owned collectively" (emphasis added) or "a centralized government that often plans and controls the economy"?
Or are you merely proving my point by trying to define socialism down to a triviality?
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The GP did not use the obligatory /s indicator, so can't tell if serious or not. But it was Archie Bunker asking, so if you imagine the question being asked in Archie Bunker's voice, it's more comical.
Re: I bet 10$ (Score:2)
No. Sadly, there's this common theme among progressives where they say one thing but mean something else, and everybody else is supposed to just read their minds to understand what the fuck they're talking about.
For example, amimoji was insisting that "real journalism" always makes socialism look good. So he got pissed off when I mentioned North Korea, Cuba and Venezuela. You see, he has welfare confused with socialism, and he expects me to know what the fuck is going on in his own broken head.
And then of c
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Would it not be socialism if the money went to US citizens?
It would certainly be fair, as the citizens pay for the US federal government (and their state governments, and others). And if the US federal government had the citizens' interests at heart, it might well share the money among them. Admittedly it would only buy a cheap meal, a short evening at a bar, or the cheapest item of clothing. Or maybe a book or two, or some music. But if shared within a family it could do some genuine good.
Not going to happen in a nation that worships wealth, and believes that as m
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They send it to Ukraine to kill people with.... Not a dime of it will be spent in the USA. BET. ;-)
Under the current administration, I wouldn't take your bet. But, as it's unlikely the sale will be finalized within 10 days of this posting, I wouldn't be surprised if much of it went to Russia instead of Ukraine. Same purpose (to kill people) but different recipient.
Re:I bet 10$ (Score:5, Interesting)
They send it to Ukraine to kill people with.... Not a dime of it will be spent in the USA. BET. ;-)
Nah. It'll just go into the general fund. Given that the general fund is operating at an annual deficit of $1.4T (which Trump aims to increase, though 2025 will be Biden's budget), it will merely reduce the 2025 deficit by about 4%.
Well, that assumes they'll get $6.5B for it... which they won't. How much the price of BTC is reduced by this sale will be interesting. BTC has enough market volume to take that sale these days, but it's still very volatile and the price is held up by the fact that a lot of BTC is held by hodlers who won't sell for any reason except to exchange with other hodlers to boost volume, which means that BTC price will take a bigger hit than market volume would normally predict.
I really hope they dump the entire lot in a single sale. Economists will be able to write many interesting papers.
Make everybody angry. (Score:2)
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They should deposit all the confiscated bitcoin into the Social Security trust fund.
The Social Security Trust fund is basically a fiction. Social Security revenues are invested in Treasury bills, which means the cash goes into the general fund and the trust fund gets IOUs -- to be paid back from the general fund. This is effectively no different at all from eliminating the trust fund and just routing SS revenues into and paying SS benefits out of the general fund.
Also, $6.5B (or whatever smaller amount the DoJ actually gets) is miniscule relative to social security revenues and expense
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According to this data [ssa.gov] in 2009 the Social Security Trust Fund payed out ~$686B. This $6.5B would represent less than 1%, or not even half a week of social security payout.
By the way, according to the same data, since 1981 the Social Security Trust Fund has actually been adding net gains, as tax receipts have been higher than payouts.
Re:I bet 10$ (Score:4, Insightful)
though 2025 will be Biden's budget
Only the first bit until the GOP rams through a reconciliation bill that rewrites the budget and appropriations, and Trump signs it. Then it's on him.
He who last changed it, gets the responsibility for the deficits. No, it isn't valid to pass a bunch of tax cuts for rich assholes without paying for them, and try to blame the last administration that spent 4 years trying to get rich assholes to pay their taxes against all efforts of the GOP.
Where does all that money go? (Score:2)
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Income to the government general fund does not have a name tag associated with it as to where it goes. Ever try to tag your income tax?
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Cocaine and hookers. Or at least "state dinners" and "entertainment." Which is usually code for, "Make a big public fuss, then have coke and hookers in private."
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Like all income of the federal government it goes to the US Treasury. Congress will eventually pass laws that authorizes spending.
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I think the existing laws already cover that.
State piracy (Score:1)
Apparently, the US govenment can simply help istelf to whatever assets it feels like. A few billion dollars of someone else's bitcoin; any cash the police find while rummaging through a law-abiding US citizen's car after a probably illegal stop and search; $300 billion or so in Russian assets, foolishly entrusted to Western financial institutions... and on and on and on. I suppose that when a government is over $30 trillion in debt, it grabs whatever it can.
"Take what you can; give nothing back". - "Pirates
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The government can seize assets associated with crime. I'm not familiar with this specific case but if they seized the assets and there was indeed a crime... it's legal.
No crime required, under civil asset forfeiture if they think it's proceeds of a crime they can take it and you have to fight to get it back. It doesn't require a conviction or even charges to be brought.
Re:State piracy (Score:4, Insightful)
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Absolutely true they don't need to prove a crime. But in this case, they did prove a crime. So its kind of moot.
In this case yes, but I was addressing Ogiv17's generalization.
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It was seized assets from crime. But don't let facts get in the way of your ignorance.
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Look up Asset Forfeiture, no crime is required. Even in states (like mine) where forfeiture is banned, the DOJ still launders (to this day) money siezed by state and local law enforcement.
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Legal doesn't equal just. The forfeiture should not be possible until AFTER the crime has been proven in court. In this case it appears just, but it often isn't.
AFAICT, part of the reason for asset forfeiture is to prevent the accused from being able to hire adequate defense. (The fact that you need lots of money to hire adequate defense is also unjust. As is the fact that even if you're found innocent, you're still out of pocket that huge fee.)
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Yeah, or they were able to prove in court that this bitcoin was payment for illegal services and goods, which means it's subject to asset forfeiture just the same as if it was bundles of $20 bills found under the mattress next to a brick of heroin.
But don't let that get in the way of your "boo hoo criminals are getting caught and getting their shit took, but it was on the Internet so it should be different!" nonsense.
Who's their client? (Score:3)
The curious thing in this story for me is that Battle Born are claiming the crypto is theirs, that they were owed something from a bankruptcy case gone bad.
Quite ballsy to take on the US government and trying to convince a legal system that the client that owned them money was doing legitimate honest business on the dark web, but hey.
Put it on a hard drive and send it to landfill (Score:3)
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Wouldn't that make the value of individual BTC go up, not down? Supply and demand and all that jazz?
He's a leftist, he doesn't believe any of that. Yes, DOJ, please destroy those BTC by any means! Transfer them to a random-password wallet and make them be gone forever! Quick before fascist Trump takes over! I'm sure it'll make all the BTC holders cry! :DDDDDD
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Alternatively, sell it off all at once in order to completely crash the Bitcoin market. Either way is a net win for society.
Nice try, but BTC has 30-100B daily trading value. Your 5B BTC dumped on a market will cause a bit of a single-day swing at most. The "completely crash BTC market" train has left long ago, soooowwwy :DDDDDDDD
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Alternatively, sell it off all at once in order to completely crash the Bitcoin market. Either way is a net win for society.
Nice try, but BTC has 30-100B daily trading value. Your 5B BTC dumped on a market will cause a bit of a single-day swing at most. The "completely crash BTC market" train has left long ago, soooowwwy :DDDDDDDD
I of course meant "5B USD worth in BTC", not 5B BTC.
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This sale would demonstrate how much of that daily trading value is just wash trades.
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This sale would demonstrate how much of that daily trading value is just wash trades.
Yes, there's a huge conspiracy of people running fake BTC transactions for uhhhh.... reasons and stuff. Also, aliens with giant lazors monted on their heads are involved.
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https://www.sciencedirect.com/... [sciencedirect.com]
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https://www.sciencedirect.com/... [sciencedirect.com]
If they really believed that they'd be shorting bitcoin. But of course, talk is cheaper than, you know, actual monetary investment.
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Do you know that they aren't?
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Throwing away those coins props up the market by increasing the artificial scarcity.
Selling - even threatening to sell - those coins should show us just how solid Bitcoin actually is. A lot of the big action in Bitcoin is fake to fool the rubes and keep the price climbing.
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Throwing away those coins props up the market by increasing the artificial scarcity.
Selling - even threatening to sell - those coins should show us just how solid Bitcoin actually is. A lot of the big action in Bitcoin is fake to fool the rubes and keep the price climbing.
I guess the question is can an exchange or exchanges cash out that much, or even a significant percentage at once? Looking at a trading volume graph [blockchain.com], that's a significant multiple of daily volumes and absent a market maker unlike to be able to be liquidated at once.
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Nobody says they have to liquidate it all at once. The US Treasury is pretty smart about this kind of thing, and knows they'll get better returns if they announce a divestiture plan so the market can react accordingly and not crash the plane into the mountain.
They'll do monthly releases or quarterly releases until it's off the books and turned into US dollars, just like if they seized any other large quantity of securities.
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Nobody says they have to liquidate it all at once. The US Treasury is pretty smart about this kind of thing, and knows they'll get better returns if they announce a divestiture plan so the market can react accordingly and not crash the plane into the mountain.
They'll do monthly releases or quarterly releases until it's off the books and turned into US dollars, just like if they seized any other large quantity of securities.
While I agree with you, a political consideration is what message does the US government want to send about bitcoin. If they want to cause uncertainty they could dump a little, 6 billion is chump change if they want to make a statement. Securities, OTOH, are critical part of the financial system and thus the need to not negatively impact them, unlike bitcoin
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the coins will just be bought by one or several of the ETF's for liquidity. It won't be market affecting. Your thesis about bitcoin is incorrect.
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Oh look everyone, a cultie!
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Throwing away those coins props up the market by increasing the artificial scarcity.
Selling - even threatening to sell - those coins should show us just how solid Bitcoin actually is. A lot of the big action in Bitcoin is fake to fool the rubes and keep the price climbing.
Well, guess what, the "threaten to sell" part just happened, that's the very essence of this news item, the appearance of a very real threat of all those BTC being dumped on the market, Any Day Now. The BTC market has already reacted. With a shrug [google.com]. Sowwwwy, all the BTC hater leftists here, BTC has grown too large for such a trivial treat to "crash" it :DDDDDDD
Bitcoin reserve (Score:2)
I'd bet that Trump blocks this sale and claims that these 69,370 Bitcoins are now that Bitcoin Reserve he promised his crypto bro supporters.
Re:Bitcoin reserve (Score:4, Funny)
Ten Days (Score:1)
Ross is getting pardoned in ten days
How "coincidental" that they're rushing now.
Is the Federal Agent who stole some of the bitcoin and entered fake testimony against Ross still in prison?
Give it to (Score:2)