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United States Marshal Service To Blind Auction 50K BTC

16 Nov 2014

The USMS reserves the right to reject any bid for any reason whatsoever. The USMS reserves the right to sell all, some or none of the bitcoins at auction. - Units States Marshall Service.

USMS quote 1In January 2014, Ross William Ulbricht, aka ‘Dread Pirate Roberts’, claimed ownership of 144K BTC seized during the closure of Silk Road. Later that month he signed a Stipulation and order for interlocutory sale of Bitcoins. This allows the United States government to sell his private Bitcoin funds as and when they see fit.

“On January 27, 2014, the United States District Court for the Southern District of New York entered a stipulation and order for interlocutory sale of Bitcoins wherein the United States and Ross William Ulbricht agreed that the United States may sell any portion or all of the computer hardware Bitcoins on a date or dates in a manner to be determined by the government,”

Although not convicted of any crime, Ulbrichts Bitcoins have been seized under the contentious civil forfeiture legal process in the US. By claiming the 144K BTC Ulbricht may be entitled to the sale proceeds, should he be proved innocent. In his deposition regarding the case Christopher Tarbel, Special Agent with the Federal Bureau of Investigation, provided details regarding the scale of Silk Road,

“there were approximately 1,229,465 transactions completed on the site, involving 146,946 unique buyer accounts, and 3,877 unique vendor accounts. The total revenue generated from these sales was 9,519,664 Bitcoins, and the total commissions collected by Silk Road from the sales amounted to 614,305 Bitcoins.”

In June 2014 the United States Marshall Services (USMS) auctioned 30k BTC seized from user accounts connected to online marketplace. Tim Draper, Founder and Managing Director, Draper Fisher Jurvetson, purchased the coins for a rumoured $600 each, a sale totalling  approximately $18 million.

Nearly 6 months down the track, it appears that the USMS have made the decision to sell a portion of Ulbrichts 144K BTCs, in a blind auction. This style of auction requires a single sealed bid, with no knowledge of the value of other bids.

50,000 BTC will be sold in two series. Series A consists of 10 blocks at 2000 BTC each. A deposit for registration is required, set at $100k USD. Series B consists of 10 blocks at 3000 BTC, $150k deposit required.

Deposits for registration are required to be wired from within the US to the USMS account at the Federal Reserve Bank. Registered interest be able to bid on their desired amount of BTC on the 4th December 2014. Unsuccessful bidders will have their deposits returned to their US bank accounts within five days of the auctions completion.

Although a sealed bidding process, in the June auction USMS sent out an e-mail disclosing all the participating bidders.

"The message was not intended for any particular group of people, but for anyone who had emailed a question to the general mailbox to ask about the auction. Only recipient email addresses were disclosed." – Lynzey Donahue, US Marshalls office

While deposits of 6 figures and large blocks of BTC raise concerns of restricting the sale to high net worth individuals and institutional investors. Barry Silbert, SecondMarket and Bitcoin Investment Trust Founder, released details of a bidding syndicate involved in Junes auction. According to Silbert, there were 42 bidders involved in the syndicate, with 186 bids received and a bitcoin quantity bid of 48,013.

Should you wish to form a syndicate, or register your interest, you can find the details here.


B.Holmes, author of The Range of Illusion and The Private Key installments, is currently located in Thailand, researching and writing about crypto. You can follow B.Holmes on twitter @BanteringB, or contact via email: [email protected]


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