Categories: SecurityWorkspace

Silk Road Bitcoin Auction Won By Venture Capitalist

The sole winner of the auction of  just under 30,000 Bitcoins seized by police during the investigation of Silk Road has been revealed as well known venture capitalist Tim Draper, who partnered with Vaurum, which facilitates over-the-counter bitcoin trading to make the purchase.

Last October, the FBI seized 29,655 bitcoins from illegal online marketplace Silk Road, in what was the largest ever seizure of virtual currency, thought to be worth in the region of £16.44 million at that time.

Silk Road was hosted on the anonymous Tor network and used to sell everything from drugs and weapons to malware, forged documents and stolen credit card details, before the FBI arrested Ross William Ulbricht, a 29 year old US citizen who allegedly ran the website since 2011 under the alias Dread Pirate Roberts.

Bitcoin Auction

Silk Road used Bitcoin as the currency of choice, and following the arrest, the FBI found 29,655 BTC in the accounts that were linked to the website. However, there are another 144,336 bitcoins worth around £78 million that were stashed on Ulbricht’s laptop and technically still belong to him.

The US Marshals Service auctioned off the Bitcoin in a sealed bidding process, amid online concerns that the auction was nothing more than a sting operation, intent on finding major players in underground market.

However Tim Draper has come forward and revealed that he is the sole winner, but he refuses to reveal how much his paid for his Bitcoin haul. Draper was quoted by Forbes as stating only the obvious, that he “paid more than the other people in the auction.” Meanwhile a US Marshals spokesperson, said that 45 bidders had made 63 bids.

“Bitcoin frees people from trying to operate in a modern market economy with weak currencies. With the help of Vaurum and this newly purchased bitcoin, we expect to be able to create new services that can provide liquidity and confidence to markets that have been hamstrung by weak currencies,” Draper said in a statement.

A press conference was live streamed on Wednesday, in which Draper praised Bitcoin. He said it will “revolutionize finance.” He said Bitcoins were the world’s most secure currency, and not tied to any political machinations.

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Tom Jowitt

Tom Jowitt is a leading British tech freelancer and long standing contributor to Silicon UK. He is also a bit of a Lord of the Rings nut...

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