U.S. appeals court finalizes mandate for forfeiture of Silk Road bitcoin

Quick Take

  • Judgment was first made in August but will now take effect, according to a filing in the U.S. District Court of Appeals for the Ninth Circuit.

A U.S. appeals court finalized a mandate on Wednesday that formalizes the forfeiture of 69,370 of bitcoin and other crypto connected to the now-defunct Silk Road dark web market. 

The judgment was first made in August, but will now take effect according to a filing in the U.S. District Court of Appeals for the Ninth Circuit. The filing on Wednesday lists Silk Road founder Ross Ulbricht as a defendant, two claimants and the U.S. government as a plaintiff.

The U.S. government had already been in control of the crypto after it was handed over by a so-called "Individual X" who hacked into Silk Road and gained control of its funds, according to the original complaint.

In 2020, the U.S. Justice Department seized and began seeking the official forfeiture of the crypto, which at the time was valued at over $1 billion. A few days earlier, 69,369 bitcoins were moved out of a wallet address, marking the first such activity for the collected holdings since 2015, according to previous reporting by The Block. 

Movements of the funds are closely tracked, as market participants frequently speculate about the possible impact any large sale by the U.S. government could have on bitcoin's price.

Behind bars

Ross Ulbricht, who is serving a life sentence in jail, founded the Silk Road and operated it from 2011 to 2013. The site was used for selling drugs and weapons and was shut down by the Federal Bureau of Investigation following the arrest of Ulbricht in late 2013.

Ulbricht agreed to use $3 billion in stolen bitcoin to pay debt to the U.S. government in 2022 and relinquished the right to 69,470 in bitcoin.

Disclaimer: The Block is an independent media outlet that delivers news, research, and data. As of November 2023, Foresight Ventures is a majority investor of The Block. Foresight Ventures invests in other companies in the crypto space. Crypto exchange Bitget is an anchor LP for Foresight Ventures. The Block continues to operate independently to deliver objective, impactful, and timely information about the crypto industry. Here are our current financial disclosures.

© 2023 The Block. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.