Last fall, the government shut down the Silk Road, an online drug market. In the process of taking down the Silk Road, federal agents seized 29,656 Bitcoins. Just as with any other bust of this kind, the seized property was put up for auction.
The U.S. Marshals Service put up the Bitcoins for a twelve-hour auction on June 27. In order to participate, bidders had to register by wiring $200,000 to a government bank, weeding out any unserious and ineligible buyers. The auction received 45 registered bidders and 63 bids. On Tuesday, the results were (sort of) revealed.
While the Marshals office did not disclose the amount of the winning bid, or the identity of the winning bidder, we do know who didn't win. SecondMarket, Pantera Bitcoin, the Bitcoin Shop, Coinbase, Rangeley Capital, and CoinApex were all outbid, and these are some of the most important institutions within the Bitcoin community. This means whoever the winner was, they are very serious, and had a lot of cash to throw around.
The winner may even have paid above the market price at the time of the auction, around $570 per Bitcoin. However, they should still be receiving a handsome profit, as Bitcoin has since shot up to $650, in large part due to this successful auction.
This article is from the archive of our partner The Wire.
We want to hear what you think about this article. Submit a letter to the editor or write to email@example.com.