- Prosecutors say an unnamed hacker stole the trove from Silk Road and moved them to a wallet where they sat from April 2013 until the Tuesday seizure.
- The individual consented to the government seizure on Tuesday.
- The news comes days after blockchain intelligence firm Elliptic reported that a wallet possibly belonging to the Silk Road marketplace moved almost $1 billion worth of bitcoin (BTC, +0.07%) earlier this week.
- This was the first transaction from the address since 2015, when it transferred 101 BTC to BTC-e – a now-shuttered cryptocurrency exchange allegedly favored by money launderers, Elliptic said.
i wonder what the exact course of events was, or more specifically, where the hacker made his mistake. this makes it sound like he moved the coins in a way (or to an exchange?) where they were identified by the USA government. then they gave up access to the coins to police as part of a plea agreement, or in an attempt to gain leniency.
if this is anything like the first silk road seizure, those coins will start being auctioned off by the US marshals in.....6-7 months? i wonder if it'll have much effect on supply, in the sense that OTC buyers accumulating via those auctions won't be accumulating from other OTC or exchange sources.
The actual court document seems to provide a rough outline of events. Some snippets:
15.In 2020, law enforcement officers used a third party bitcoin attribution company to analyze Bitcoin transactions executed by Silk Road. From this review they observed 54 transactions that were sent from Bitcoin addresses controlled by Silk Road, to two Bitcoin addresses:1BADznNF3W1gi47R 65MQs754KB7zTaGuYZ and 1BBqjKsYuLEUE9Y5WzdbzCtY zC iQgHqtP N totaling 70,411.46 BTC (valued at approximately $354,000 at the time of transfer).
16.The individual amounts that were transferred were mainly round Bitcoin amounts and close together in time. For example, 10 of the transfers occurred at approximately 3:59 a.m. and each transfer was for exactly 2,500 Bitc oin. This pattern of withdrawals and the amount that was withdrawn was not typical for a Silk Road user. Specifically, a review of other withdrawals from Silk Road revealed Bitcoin amounts that were mostly less than 100 Bitc oin. These 54 transactions were not noted in the Silk Road database as a vendor withdrawal or a Silk Road employee withdrawal and therefore appear to represent Bitcoin that was stolen from Silk Road.
17.On approximately April 9, 2013, the Bitcoin addresses that received the 70,411.46 B itc oin from Silk Road sent 69,471.082201 (approximately $14 million at the time of transfer) to 1HQ3Go3ggs8pFnXuHVHRytP Cq5f GG8H bhx (hereafter “1HQ3”).
[...]
21.Individual X, whose identity is known to the government, was determined to have been involved in a transaction that related to 1HQ3.
22.According to an investigation conducted by the Criminal Investigation Division of the Internal Revenue Service and the U.S. Attorney’s Office for the Northern District of California, Individua l X was the individua l who moved the cryptocurrency from Silk Road. According to the investigation, Individua l X was able to hack into Silk Road and gain unauthorized and illegal access to Silk Road and thereby steal the illicit cryptocurrency from Silk Road and move it into wallets that Individua l X controlled. According to the investigation, Ulbricht became aware of Individual X’s online identity and threatened Individua l X for return of the cryptocurrency to Ulbricht. Individua l X did not return the cryptocurrency but kept it and did not spend it.
23.On November 3, 2020, Individual X signed a Consent and Agreement to Forfeiture with the U.S. Attorney’s Office, Northern Dis tr ict of California. In that agreement, Individual X, consented to the forfeiture of the Defendant P roperty to the United States government.
One thing of note is that "Individual X" sent money from the hack to BTC-e in 2015, which could have led to his identity being known to the authorities. That may ultimately have been inconsequential though, since Ross Ulbricht himself somehow knew of their identity as well.