US files intent to dispose $117 million in bitcoin seized from Silk Road drug dealer

Quick Take

  • The U.S. government filed a notice stating its plan to sell $117 million worth of bitcoin seized from two individuals including dark web drug dealer Ryan Farace, who used the Silk Road. 
  • The DOJ charged Farace, aka Xanaxman, in 2018, and the funds were seized in 2021. 

The U.S. government filed a notice announcing its intention to dispose of about $117 million worth of bitcoin seized in a dark web drug bust. 

In the notice dated Jan. 8, the U.S. government said it planned to dispose, "in such manner as the United States Attorney General may direct," nearly 2,875 bitcoin seized from Ryan Farace and Sean Bridges in 2021, in addition to another roughly 59 bitcion that belonged to Farace alone.

At the time of the filing, the seized bitcoin was worth about $133 million.

In 2018, the U.S. Department of Justice said it was charging Farace for illegally selling Xanax on the dark web.

"The indictment alleges that Farace distributed the drugs through sales on the dark web in exchange for bitcoin," the DOJ's statement said at the time. Earlier this month, the U.S. Attorney's Office said Farace and his father Joseph Farace had both been sentenced to prison for money laundering conspiracy.

Xanaxman used Silk Road


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Farace, who dealt drugs online under the pseudonym Xanaxman, stated in plea deal that he used Silk Road, the infamous dark web site. The U.S. government also said, in its statement outlining its intent to sell the bitcoin, that anyone that wanted to claim "interest in the forfeited property" could do so within 60 days.

Separately, in December, a U.S. appeals court finalized a mandate formalizing the forfeiture of 69,370 of bitcoin connected to the now-defunct Silk Road dark web market.  

Market watchers have been closely monitoring those funds, often speculating how a large sale of bitcoin by the U.S. government could impact the cryptocurrency's price.

Silk Road's founder Ross Ulbricht is currently serving a life sentence in jail. He operated the dark web site where drugs and weapons were sold from 2011 to 2013. The site was shut down by the Federal Bureau of Investigation following the Ulbricht's arrest in late 2013.

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About Author

RT Watson is a senior reporter at The Block who covers a wide array of topics including U.S.-based companies, blockchain gaming and NFTs. Formerly covered entertainment at The Wall Street Journal, where he wrote about Disney, Netflix, Warner Bros. and the creator economy while focusing primarily on technological disruption across media. Previous to that he covered corporate, economic and political news in Brazil while at Bloomberg. RT has interviewed a diverse cast of characters including CEOs, media moguls, top influencers, politicians, blue-collar workers, drug traffickers and convicted criminals. Holds a master's degree in Digital Sociology.


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