Bitcoin Confiscated In Drug Bust to Be Sold By Authorities |

The rise in Bitcoin value has made Utah authorities sought to sell the confiscated Bitcoin in the raid of an online drug trade.

Aaron Shamo was arrested by the authorities for trafficking drugs on the Darknet where illegal goods and services are exchanged for Bitcoin. During his arrest, authorities confiscated Bitcoins which was worth $500,000 but worth $8.5 million today. This has put the authorities in a rush to sell the Bitcoin before the price falls.

The sale of seized financial assets is not new; it is a routine just like the sales of seized cars.

The Ruling

Earlier this week, Dale Kimball, the Judge of the U.S District Court issued the ruling for U. S attorney office in Utah to sell the assets of the arrested drug Lord. The decision to sell the assets of Shamo including his seized Bitcoin was engineered by the volatile market of the currency. The fear of losing the currency’s value considering the late predictions of some so-called critics will be a fair deal to sell them now.

“Due to the volatile market for cryptocurrencies’,  the BTC and BCH risk losing value during the pendency of the forfeiture proceedings,” according to the prosecutor. The price has already shown a sign of falling after a South Korea Exchange got hacked.

A source has also indicated that the bitcoin will only be sold after Shamo’s case has been resolved. In this case, the proceeds of the sale will go to the department that investigated the case, which is the Drug Enforcement Administration (DEA).

A Recap of Shamo’s Arrest

Aaron Shamo, 26 (at the time of his arrest) worked directly on the Darknet marketplace trafficking drugs across the United States of America by mail.

According to information, he played a part in the death of a guitarist, Matt Roberts, being found dead in his room for a drug overdose. Even though a doctor in Alabama was charged with prescribing an illegal drug to the victim, Shamo was the reason why the drug found its way into that scene.

Authorities searched the home of Shamo in Cottonwood Height and found 70,000 fentanyl pills. Fentanyl has contributed to many drug overdose death in Utah and across America. This drug is easy to ship to buyers due to its form, and shipment is made after payment is made in Bitcoin.

Aside the found 70,000 pills, authorities also found 25,000 Xanax pills and an anti-anxiety drug. Bitcoin has facilitated trading in the online black market due to its power to keep users anonymous.

The United States of America took a similar step in 2014 after the famous Darknet marketplace called Silk Road was shut down by the authorities. They seized a huge sum of bitcoin from both the administrator and the found users. 30,000 bitcoin was therefore auctioned in 2014. The 30,000 bitcoin would have been a lot of money today had the authorities delayed the auction.

Previous Auction of Bitcoin by Authorities Worldwide

The United States of America has sold a number of Bitcoins seized from cyber criminals and Darknet criminals in the past. In June 2014, 30000 bitcoin was sold to the Timothy Draper, the venture Draper. On December 2014, a 48000 bitcoin was auctioned and bought by the Secondmarket. 44000 bitcoin and 2700 bitcoin were also sold in 2015 and 2016 respectively to some unknown buyers.

South Korea in the mid of 2017 planned to auction $540,000 in bitcoin seized from a cyber operation carried out by the South Gyeonggi Provincial Police Agency. This decision was made after the arrest of a 33-year-old man who illegally operated an obscenity website.

The Korea Asset Management Corporation is the agency formed by the government to ensure the management of assets seized from operations. It is therefore legal in the country to subject any seized financial asset which includes digital currencies under auction.

This raises the question whether countries that do not recognize digital currencies as a legal tender but seize them in an operation actually auction them as the others do.

The auction intended to be made by South Korea was the first of its kind.

People have raised concerns that selling assets earned from illegal operations is an unfair way of dealing with arrested criminals. However, the various governments find this a way to fund their various expenditures, serving as a source of government revenues. All in all, there is enough reason to regulate Bitcoin.



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