U.S Prosecutors to Cash in On Seized Bitcoins
An amount of 513 bitcoin worth over $8 million is about to make its way into the market and this is according to the US attorneyâs office. An amount of 513.1490393 bitcoin was seized by federal prosecutors as part of a drug case in Salt Lake City. The bitcoin when seized were worth nearly $500,000 at that time, thatâs barely a year ago, but are now going to generate over $8.4 million in the cryptocurrency market due to the recent surge in the price of the hottest virtual currency.
The money that will be generated once the sale is done will be sent to an account held at the Treasury Executive Office for Asset Forfeiture.
An amount of bitcoin cash which has a value of about $1.5 million today, was also seized together with a Ford truck and a BMW all from Aaron Shamo after he was indicted together with six others in December last year.
Now, many might think that the feds cashing on this amount of bitcoin while still prosecuting a multimillion-drug trade in Utah might not be a smart move since even the alleged head of the operation, Shamo has pleaded not guilty to all the numerous charges against him. The U.S. Attorneyâs Office for Utah has however alluded this intended plan to the volatility of the price of the cryptocurrency in court documents, which is pushing for the sale to happen.
A statement released read that the amount of bitcoin together with the bitcoin cash has been transferred to a government wallet, and due to the turbulent nature of the crypto market, the bitcoin and bitcoin cash was at a logical risk of losing value while the proceedings were to be forfeited for many reasons.
The statement also included that the costs involved in storing and maintaining these cryptocurrencies while the sentencing was still pending, in addition to the numerous forfeited proceedings may affect the value of the digital currencies when sent to the market.
According to the documents, the sale of the cryptocurrencies will be done through one or more exchanges but will be sent there in increments not more than 50 coins as security precautions against the available cybercrimes.
Greg Skordas, Shamoâs lawyer stated that they are not contesting the sale, although his client has entered into pleas of not guilty to all his charges including money laundering and possession of fentanyl.
This sale wonât be the first time confiscated items or cryptocurrencies seized by the authorities are going to be sold as the U.S. and other countries have made millions selling items confiscated from criminals.
The U.S. Marshals Service auctioned close to 30,000 bitcoins which were seized in 2014 from the dark web marketplace Silk Road in one of the largest takedowns. The U.S. government has profited in millions of dollars from other seizures, as well.
Melodie Rydalch, a spokeswoman for the Utah attorneyâs office, speaking after the green light was given stated that: âFor federal prosecutors in Utah, sales of seized assets like cars are routine, but Bitcoin is new territory.â
âThe proceeds of the Bitcoin sale will be held until the case is resolved, and then decisions will be made about where the money goes,â she added.
27-year-old Aaron Shamo was arrested in 2016 by U.S. authorities for his role in a massive fentanyl distribution ring on the dark web. He was charged with running a multimillion-dollar drug ring out of a basement in Salt Lake City and is facing a possible mandatory life imprisonment if found guilty of one of his dozen charges.
He was considered by the Drug Enforcement Agency (DEA) as one of the most successful drug kingpins in Utah. The DEA also believed Shamo was the head of a global fentanyl operation on the dark web. This bust has been marked as one of the largest of its kind.
Fentanyl, the synthetic opioid has been the cause of many deaths in the state and raised many concerns. Almost 500,000 pills were seized from his house in Cottonwood Heights in Utah. He had $1.2 million in cash hidden in garbage bags in his basement when he was arrested, as well as, pills which were made to look like Xanax. The feds upon further analysis realized that the pills were indeed fentanyl.
Reports from the authorities suggest that Shamo and a partner were selling fake prescription drugs on a dark web marketplace to over thousands of people in the U.S.