Feds finish massive sale of seized dark Web bitcoins

The government on Thursday announced it had completed a massive auction of the bitcoins it seized during the takedown of the online black market Silk Road.

The notorious dark Web marketplace was a haven for drugs and other illicit purchases before it was shuttered by the FBI in 2013. As part of the investigation, officials nabbed a trove of bitcoins, the anonymous digital currency used to run the site.

{mosads}In total, the government seized over 144,000 bitcoins — worth over $47 million at the current exchange rate but considerably more at the time. It was considered the largest digital currency seizure at the time.

Officials have since auctioned off that cache in three chunks.

On Thursday, the U.S. Marshals Service said four bidders had won the final 40,000 bitcoins, worth about $14.6 million, Reuters reported.

The leading bidder took home over half of the stash, with 24,341.

The action against Silk Road was one of the first major victories for law enforcement against the online black market.

Prosecutors said Silk Road generated revenue surpassing $1.2 billion in its two-and-a-half year existence. The site trafficked in legal products, but also sold a slew of drugs, malicious software and other illegal products, operating with the anonymity of bitcoin, a digital currency.

Ross Ulbricht, who was arrested in connection with the sting, was recently sentenced to life in prison for his role creating and operating Silk Road.

Law enforcement officials have since cracked down further on underground digital marketplaces. Last fall, authorities across the globe pulled down Silk Road 2.0 and dozens of other dark Web sites it accused of selling illicit goods and services.

The bitcoin community has since worked to become more mainstream.

Two virtual currency firms have received banking charters from New York’s top banking regulator, including a bitcoin exchange from Tyler and Cameron Winklevoss, best known for their drawn-out lawsuit against Facebook founder Mark Zuckerberg. They have proclaimed their exchange a “hack-free” site.