On November 3rd, the blockchain analysis firm CipherTrace published a very interesting report. Someone has moved almost 69,370 bitcoins from one wallet to another. The move is the first activity in the wallet since April of 2015. The coins have been traced back and it has been found that they were all stolen from the Silk Road marketplace.
The coins have been moved from the address 1HQ3Go3ggs8pFnXuHVHRytPCq5fGG8Hbhx to bc1qa5wkgaew2dkv56kfvj49j0av5nml45x9ek9hz6. The transfer did not occur in one transaction. At first only 1 bitcoin was sent to the wallet. Following that, another 69,369 coins have been sent. CipherTrace suggested that the first transactions most likely served as a test.
Getting on the Radar
This move was a very significant one. Most call this a bitcoin whale. Only a few days passed without any intervention. A couple of days after the transfer, the U.S. Attorney's Office in Northern California made an announcement. A complaint was being filled to forfeit the thousands of Bitcoins, Bitcoin Cash, Bitcoin Gold and Bitcoin SV. The civil complaint alleges that an individual that has been identified by law enforcement agencies has hacked Silk Road. After hacking the market, he diverted the coins to his own wallet.
An investigation was conducted by the Criminal Investigation Division of International Revenue. The U.S. Attorney’s Office for Northern California also took part. The investigation concluded that the threat actor has gained unauthorized access to Silk Road. The investigation found that Ulbricht, the founder of Silk Road became aware of the hack. He then threatened the hacker to return the cryptocurrency. The man did not give into the threats and kept all of the coins. Despite that, the coins remained in the mans wallet untouched for years.
It is unclear how the individual was tracked by the organizations. The man, later agreed and signed to forfeiture the coins. The papers were signed with the U.S. Attorney’s Office of Northern California. The Department of Justice seized the coins later that day.
There has not been any information about any charges regarding the theft and possession of illegal cryptocurrency. Perhaps the government is happy that the man easily signed away more than 69,000 bitcoins. It is unclear what the government will do with this enormous amount of cryptocurrency. At the moment, this stash is worth over $1 Billion US Dollars. The most likely scenario is the coins funding future law enforcement operations.