Urgent plea to prevent auction of $1.6B Bitcoin seized from Silk Road hacker

Urgent plea to prevent auction of $1.6B Bitcoin seized from Silk Road hacker

Pierre Rochard has made an “urgent” plea to lawmakers to instead create a strategic Bitcoin reserve and fill it with BTC seized by law enforcement.

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Bitcoin influencer Pierre Rochard has called on lawmakers to prevent more than $1.6 billion worth of seized Bitcoin from being auctioned, proposing instead that confiscated coins be put into a strategic BTC reserve.

Rochard, a Bitcoin maximalist behind the recent controversy over ETH’s total supply, wants legislators to draft and pass a bill containing amendments to the Judiciary Act of 1789 that would allow the U.S. Marshals Service to hold onto any Bitcoin it received.

In a blog post published on Dec. 16, Rochard warned against the auctioning of 69,370 Bitcoin seized by the IRS in November from an alleged Silk Road hacker, noting that the U.S. Attorney’s Office has filed a civil complaint for forfeiture of the BTC.

Speaking to Cointelegraph, Rochard emphasized the “urgent” need to update the legislation, asserting he expects the U.S. Marshals Service to win its forfeiture case and auction off the Bitcoin “within the next six months.”

“We need to get this law passed very quickly so that we can stop the auction,” he said.

In his blog, Rochard emphasizes that the past auctions of more than 144,000 Bitcoins in 2014 and 2015 generated only $122 million, while those same crypto assets would today fetch more than $3.32 billion.

“The expeditious auctioning off of seized Bitcoin was, in my view and with the benefit of hindsight, a mistake.”

While the coins seized in November are worth $1.6 billion today, Rochard suggests the United States will reap more value by holding onto the Bitcoin for the longer term, urging lawmakers to allow “Congress time to deliberate on the disposition of this unique asset.”

“The Federal Reserve can create an infinite quantity of US dollars, the proceeds received in the auction. Bitcoins can not be created out of thin air and there is a limited quantity of them […] A large strategic reserve of Bitcoin may be crucial for our national security.”

Rochard told Cointelegraph Bitcoin will soon play a “crucial” role in the treasury of national governments, predicting that “we will see governments develop large sovereign wealth funds of Bitcoin over the coming decade.”

“If the U.S. wants to maintain its leadership, both financially and also in science and technology, then we should develop a Bitcoin reserve fund at the federal level,” he said, adding:

“In the first instance, get the seized coins into it, but then as we move forward, we’re going to want to add to that reserve as well.”


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Pierre Rochard has made an “urgent” plea to lawmakers to instead create a strategic Bitcoin reserve and fill it with BTC seized by law enforcement.

CBS doco on Silk Road throws spotlight on Ross Ulbricht

CBS doco on Silk Road throws spotlight on Ross Ulbricht

The Silk Road saga gets more airtime on the latest CBS News documentary

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Mainstream U.S. media outlet CBS is airing a documentary tonight on the takedown of the Silk Road dark web marketplace.

It features an interview with Julia Vie, former girlfriend of Silk Road founder Ross Ulbricht who claims ‚Dread Pirate Roberts‘ wasn’t motivated by money — to the point where he didn’t even own a car — and that he was not a drug pusher.

In 2015 Ulbricht was found guilty of charges including aiding and abetting the distribution of narcotics, fraudulent ID trafficking, and money laundering in 2015 and received two life sentences plus 40 years.

There are calls for his release in an ongoing campaign popular with some in the crypto community. Proponents claim that he should be freed as he was a first-time offender, and all charges were non-violent in nature.

The FBI Declassified: The Dangerous Journey on the Silk Road’ aims to bring viewers closer to the FBI investigation that took down the illicit marketplace that brought Bitcoin into public consciousness as the primary method of payment.

In the documentary FBI special agents discuss how the Silk Road was used for all kinds of illicit activity such as the sales of drugs, weapons, poisons, computer hacking services, and even discussion on murders-for-hire.

Julie Vie says in excerpts released from the documentary that she remembered him coming up with the name.

“He said something about […] the Silk Road in Asia […] and how it was a huge network […] And that’s what he wanted to create, so he thought it was the perfect name.”

She added that he spent „practically 24/7“ on his computer and their relationship fell apart soon after Ulbricht launched Silk Road. Stating that she knew it was something shady, but had no idea it was as big as it was, Vie continued;

“I think he knew he was going to get caught — and end up being a martyr for his cause,”

FBI agents working on the case cited drug addiction and deaths as the primary reason the government wanted to shut down Silk Road. After several failed attempts, they finally got lucky through a „coding error on the site“ that ultimately led them to Ulbricht.

In the interview, Vie stated that Ulbricht was not street smart, adding;

„He was not at all a drug kingpin […] He never even used the money he made […] I mean, most kingpins buy furs and jewels and they’re living the life. He didn’t even have a car!“

Last week the United States Department of Justice seized around $1 billion in Bitcoin and a handful of other cryptocurrencies from a  Silk Road wallet that had been untouched since 2015.


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The Silk Road saga gets more airtime on the latest CBS News documentary

$1B of Bitcoin from Silk Road wallet moves for first time since 2015

$1B of Bitcoin from Silk Road wallet moves for first time since 2015

Ciphertrace speculated the anonymous user made the transactions “to stay up to date with the Bitcoin network,” but it may have been hacked.

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An anonymous crypto user has just moved 69,370 Bitcoin from an address associated with the Silk Road darknet market, that more recently has become a popular hacking target.

According to a Nov. 3 report from crypto intelligence firm CipherTrace, the recent movement involving two transactions adding up to 69,370 Bitcoin (BTC) — or more than $960 million at the time of publication — originated from an address connected with the Silk Road marketplace, which was shut down in 2013. The crypto user first sent 1 BTC — likely as a test transaction — before moving the bulk of the coins.

Ciphertrace speculated the anonymous user made the transactions “to stay up to date with the Bitcoin network” by switching between address formats. As the last time anyone moved funds associated with the defunct darknet market was in April 2015, the BTC wallet would reportedly also have access to all Bitcoin Cash (BCH) and Bitcoin SV (BSV) associated with the tokens’ hard forks.

However, the firm didn’t rule out hacking as a possibility:

“These movements could possibly mean that the wallet owner is moving funds to new addresses to prevent hackers from accessing the wallet.dat file or that hackers have already cracked the file.”

The Silk Road funds were contained in a wallet that has been circulating among hackers for more than two years. In September, a Twitter user claiming to have the wallet.dat file for the wallet put out a call to the crypto community for solutions on how to gain access to the more than 69,000 coins, even suggesting a quantum computer as a potential way to determine the private keys.

Silk Road was a darknet market which let users buy and sell illicit goods such as weapons and stolen credit card information, but the majority of listings were for illegal drugs. Ross Ulbricht, the site’s founder, is currently serving two life sentences without the possibility of parole after being found guilty of money laundering, computer hacking, and conspiracy to traffic narcotics. He still provides periodic analyses on the Bitcoin market from prison.


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Ciphertrace speculated the anonymous user made the transactions “to stay up to date with the Bitcoin network,” but it may have been hacked.

Silk Road Founder Ross Ulbricht: ‚The Sky is the Limit‘ for Bitcoin

Silk Road Founder Ross Ulbricht: ‚The Sky is the Limit‘ for Bitcoin

Writing from prison, Ross Ulbricht predicts the third wave of Bitcoin may result in prices rarely dropping below $20,000

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After predicting a possible Bitcoin price drop to the $3,000s, Silk Road founder and federal inmate Ross Ulbricht sees long-term bullish possibilities for the cryptocurrency price staying well above $20,000.

Posting to his personal Medium account on April 24 from the United States Penitentiary Tucson, Ulbricht expanded upon his comments earlier this month in which he saw a Bitcoin (BTC) bear run to $3,200 as a distinct possibility. While admitting his prediction was a likely scenario for the second wave, the Silk Road founder wants the crypto community to know he is “still bullish long-term.”

Source: Medium

“If wave II takes prices down to $1,000 and wave III is as big as wave I, then wave III will drive prices to $333 million. Assuming 21 million bitcoins, that’s a market cap of $7 quadrillion. That’s more than ten times the current GDP of all humanity. So the point is — long term — the sky is the limit.”

Seeing both short-term and long-term bullish possibilities for the cryptocurrency, Ulbricht attributes any possible bearish behavior between the next two waves as nothing more than “insignificant fluctuations”. According to Ulbricht: “Decades from now, [a BTC price] below $20,000 will seem cheap.”

While admitting his access to information is limited from prison, Ulbricht still provides analyses on the Bitcoin market on his Medium blog. He is currently serving two life sentences without the possibility of parole after being found guilty of money laundering, computer hacking, and conspiracy to traffic narcotics in connection with the darknet market website Silk Road.


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Writing from prison, Ross Ulbricht predicts the third wave of Bitcoin may result in prices rarely dropping below $20,000

Silk Road Founder Ross Ulbricht: Bitcoin Price Could Drop to $3,200

Silk Road Founder Ross Ulbricht: Bitcoin Price Could Drop to $3,200

The incarcerated Silk Road founder sees a Bitcoin peak over $14,000 as “very unlikely” for 2020 and predicts it bottoming out at $3,200

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Writing from the United States Penitentiary Tucson, Ross Ulbricht sees Bitcoin (BTC) getting closer to the bears as a possibility for 2020.

Posting to his personal Medium account on April 12, the Silk Road founder wrote the recent volatility of the cryptocurrency — in particular the March 12 bloodbath — will most likely lead to a bear market until “June or July 2020”. However, it could drag on into next year.

“The cycle-degree bull market — from Bitcoin’s beginning to the ~$20,000 peak of late 2017 — is over. We are now in the last wave… of Bitcoin’s first cycle-degree bear market (the largest yet).”

Source: Medium

Bitcoin could bottom out at $3,200… or lower

To back up his statement, Ulbricht referred to a prediction he had made in December, in which he said a BTC price drop under $4,200 would most likely lead to a bear market. In this scenario, Ulbricht says the cryptocurrency could bottom out at $3,200.

“A break below the major low of $3,200 will be a solid confirmation of this, at which point we will be trying to determine when the final low is in. This will be a major buying opportunity. If the price rises above the peak near $14,000, we will have to reevaluate our interpretation, but at this point that seems like a very unlikely scenario.”

Even in this bearish outcome, the wave to follow may make the 2017 peaks look like distant foothills. The Silk Road founder warns that it will take a lot of “fortitude” from inventors to buy BTC at that time, but the “new highs will be well worth it”.

Ulbricht is currently serving two life sentences without the possibility of parole after being found guilty of money laundering, computer hacking, and conspiracy to traffic narcotics. He still provides periodic analyses on the Bitcoin market from prison.


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The incarcerated Silk Road founder sees a Bitcoin peak over $14,000 as “very unlikely” for 2020 and predicts it bottoming out at $3,200

Silk Road Vendor Seeks Release From Jail Fearing COVID-19 Outbreak

Silk Road Vendor Seeks Release From Jail Fearing COVID-19 Outbreak

A former toy merchant-turned-Silk Road vendor is seeking compassionate release from jail amid the coronavirus pandemic

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United States Federal District Judge Jed Rakoff is considering temporarily releasing a 61-year-old toy retailer-turned-Silk Road vendor amid concerns of a purportedly imminent COVID-19 outbreak in a federal jail.

According to Law360 on April 8, the prisoner, Hugh Haney, is serving a three-and-a-half-year money-laundering sentence for failing to explain where he obtained $19 million in Bitcoins (BTC). 

While Judge Rakoff gave additional time to brief a bail request after an April 8 hearing, he described the motion for Haney’s compassionate release as “an argument for releasing every single person” in the facility.

Judge considers Silk Road vendor’s request for release

Martin Cohen, the lawyer representing Haney, asserts that his client may potentially face dying in prison if he is not released, adding that Haney wants to serve out his sentence in full after the outbreak has subsided.

Cohen asserts that only seven of the 1,700 inmates at the Metropolitan Detention Center in which his client is serving out his sentence have been tested for COVID-19 — three of whom have been confirmed to have the virus.

The motion for release was criticized by the Manhattan U.S. attorney’s office. The office emphasized that federal judges in New York have denied bail for inmates with underlying medical conditions — which Haney does not have. The prosecution also expressed that they consider Haney to be a flight risk.

The 61-year-old sold oxycodone on Silk Road and ceased operating in 2012. He was apprehended after failing to explain how he came to possess $19 million in Bitcoin and pleaded guilty. When he quit operating on Silk Road, Haney’s crypto stash was worth just $10,000.

„Crypto King“ fails in bid for temporary release

Haney is among several crypto criminals seeking temporary release who are fearing a rapid spread of COVID-19 in U.S. prisons.

Also on March 8, John Caruso, co-founder of the $9 million Zima Digital Assets Ponzi scheme, had his request for reconsideration of the terms of his detention rejected by the Arizona District Court.

Caruso sought the reconsideration based on COVID-19 posing an imminent threat to his health and safety in a pre-trial detention facility.

In March, the alleged operators of a $722 million Ponzi requested release from a New Jersey correctional facility citing the looming threat of a coronavirus outbreak.


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A former toy merchant-turned-Silk Road vendor is seeking compassionate release from jail amid the coronavirus pandemic

Silk Road Marketplace Senior Adviser Pleads Guilty in US Federal Court

Silk Road Marketplace Senior Adviser Pleads Guilty in US Federal Court

The senior adviser to the Silk Road dark web marketplace has admitted one count of conspiracy to distribute narcotics in a U.S. federal court

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A senior adviser to the operator of the Silk Road dark web marketplace has pled guilty to one count of conspiracy to distribute narcotics in a Manhattan federal court. According to a United States Department of Justice press release dated Jan. 30, Roger Thomas Clark was a key figure in the development of Silk Road, advising on all aspects of the enterprise, and even attempting to arrange a murder-for-hire to protect its interests.

Silk Road creator Ross Ulbricht described Clark, who used a number of online aliases such as “Variety Jones,” and “Plural of Mongoose,” as a “real mentor,” who advised about the security and running of the site.

Clark was purportedly instrumental in advising Ulbricht to concoct a cover story that he had sold the Silk Road website, and was responsible for gathering information on the authorities’ investigation of the site.

Additionally, Clark is accused of urging and facilitating an attempted murder-for-hire of a Silk Road employee who was suspected of stealing $350,000 of Bitcoin (BTC) from the organization, prosecution of which is ongoing.

Silk Road legacy continues

The Silk Road marketplace was created by Ulbricht in January 2011, and operated until 2013. It facilitated the sale of narcotics and other illegal goods and services, using a Bitcoin-based payment system to hide the identities of users, until its infiltration and eventual closure by the FBI.

As Cointelegraph reported, jailed Ulbricht has a lot of support in the cryptocurrency community, with Tim Draper recently calling for his release. Ulbricht himself has remained a supporter of Bitcoin, recently predicting that the price would hit $100,000 in 2020.

New data suggest that the use of cryptocurrencies on darknet markets doubled last year. A recent report from a New York-based blockchain analytics firm Chainalysis found that darknet markets have significantly increased their share of total incoming crypto transactions in 2019, doubling from 0.04% in 2018 to 0.08%.


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The senior adviser to the Silk Road dark web marketplace has admitted one count of conspiracy to distribute narcotics in a U.S. federal court

Silk Road Darknet Marketplace Founder: BTC Will Reach $100,000 in 2020

Silk Road Darknet Marketplace Founder: BTC Will Reach $100,000 in 2020

Silk Road’s Ross Ulbricht has predicted that BTC will hit $100,000 in 2020

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The price of Bitcoin (BTC) will skyrocket up to $100,000 in the coming year, according to the founder of infamous darknet marketplace Silk Road.

In a series of blog posts on Dec. 10, Ross Ulbricht — the founder of now-defunct anonymous marketplace Silk Road — predicted that BTC’s price will reach $100,000 in 2020. The blogs were published based on letters he wrote in prison, using a type of market analysis known as Elliott Wave Theory.

Ulbricht claimed the possibility to carry out such an analysis even without knowing Bitcoin day-to-day price movements and the general condition of the market. To forecast the highs and lows in financial market cycles, Ulbright identified extremes in investor psychology. In terms of Bitcoin, investors’ emotions purportedly play a more significant role as opposed to traditional markets.

As such, Bitcoin price could be artificially increased by investor expectations combined with mass psychology and through a positive feedback loop of buyer optimism

Industry players predict BTC price

Some other industry players have also made predictions in regards to Bitcoin price movements in the upcoming year. Sources told Cointelegraph that Andy Cheung, head of operations at cryptocurrency exchange OKEx, sees Bitcoin surging above $14,000 in 2020. According to Cheung, a Bitcoin ETF listing in the United States could be a catalyst for the price increase.

Robert Beadles, president at blockchain company Monarch, reportedly suggests that Bitcoin’s halving in May could spike the price to $11,000 around this time. “I would further venture to say Bitcoin will hit $2 million a coin in the next 5 years so long as the core dev team doesn’t destroy it accidentally from within,” Beadles added.

The mastermind behind the Silk Road

Operating under the pseudonym ‘‘Dread Pirate Roberts,” Ulbricht was the mastermind behind the Silk Road, which let users buy and sell anything, regardless of legality. Although the site listed weapons, stolen credit card details as well as legal products, illicit drugs were by far the most common listing.

The Silk Road pioneered the use of Tor, the network software used to access the darknet, and Bitcoin escrow to conceal purchaser and seller identities and their activity. Ulbricht was arrested and sentenced to life in prison in 2015, convicted of money laundering and aiding in the distribution of drugs, computer hacking and fraud, among other charges.

Earlier in December, Tim Draper, one of the most successful investors in the world, called for Ulbricht’s release.


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Silk Road’s Ross Ulbricht has predicted that BTC will hit $100,000 in 2020

Silk Road Prosecutor: 99.9% of Fiat Money Laundering Goes Unprosecuted

Silk Road Prosecutor: 99.9% of Fiat Money Laundering Goes Unprosecuted

“The financial services industry is spending $20 billion a year on AML and KYC. So I would ask you: is it even working? I don’t think it’s working”

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Kathryn Haun — a general partner at Andreesen Horowitz and the Justice Department’s prosecutor for the infamous Silk Road case —- says that the fiat-dominated financial system is inept at tackling the very thing it purports to worry about when it comes to crypto.

In the traditional financial sector today, “99.9% of all money laundering crimes go unprosecuted,” she told anchor Kyle Bass, during an interview for Real Vision Classics on Oct. 22.

“We’re kidding ourselves” 

As someone whose career involved the takedown of one of the highest-profile criminal rackets in crypto industry history and established the first-ever crypto task force for the U.S. government, Haun is no stranger to regulators’ concerns about crypto and money laundering risks. 

Yet she stressed the arguable absurdity of the defenders of the existing system emphasizing concerns over an issue that current approaches have proved to be wholly inept at preventing:

“Our current system is doing a pretty terrible job of it, I’d say. Let me tell you what I mean. 99.9% of all money laundering crimes go unprosecuted. I testified before the U.S. Senate about this, and the person who cited that statistic, other than Senator Chuck Grasley, was the ex-Treasury official. And I thought that can’t be right. But I researched it and indeed it’s true.”

“The financial services industry is spending $20 billion a year on AML [anti-money-laundering] and KYC [Know Your Customer checks],” she added, “so I would ask you: is it even working? I don’t think it’s working.”

From the perspective of AML, she said, when it comes to “moving to a decentralized system, I think we’re kidding ourselves if we think that’s going to change too much.”

Legitimate restrictions

Haun and Bass discussed the need to trace the flow of funds to combat illicit activities more broadly and the extent to which this justifies restricting the peer-to-peer flow of value transfer. 

Bass noted that having a centralized financial system provides governments with greater leverage when it comes to bad sovereign actors, a power that cryptocurrency could diminish:

“ISIS had $2 billion, it’s a widely known secret that it’s held in Turkish banks and run by legitimate businessmen who decide to launder money. If the US is looking to sanction bad sovereign actions, we can actually make it really difficult for them to move significant amounts of capital today or do business with US banks.”

Haun responded that to the extent that one can accept that a given government’s authority is being exercised in good faith and for legitimate ends, this holds true:

“But I would also say, at what cost do you do that? You have 2 billion people in the world today who are unbanked, who have zero access to financial services.”

As previously reported, Haun has recently argued that the United States blocking Facebook’s Libra digital currency will have national security implications.


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“The financial services industry is spending $20 billion a year on AML and KYC. So I would ask you: is it even working? I don’t think it’s working”

Alleged Silk Road Drug Dealer Arrested in the United States

Alleged Silk Road Drug Dealer Arrested in the United States

Authorities have arrested alleged Silk Road drug trafficker Hugh Brian Haney per an announcement from a New York district attorney

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United States Attorney for the Southern District of New York Geoffrey S. Berman announced the arrest of alleged dark web drug dealer Hugh Brian Haney in a press release published on July 18.

Per the release, Haney has been charged with money laundering. He allegedly used cryptocurrency to launder more than $19 million of profits earned selling illegal drugs on the now-defunct darknet market Silk Road. Berman commented to the development:

“Today’s arrest should be a warning to dealers peddling their drugs on the dark web that they cannot remain anonymous forever, especially when attempting to legitimize their illicit proceeds.”

Angel M. Melendez, Homeland Security Investigations (HSI) special agent-in-charge, pointed out that — after Silk Road was closed in 2013 — cyber criminals simply sought other ways to “continue their criminal activities and more importantly launder their illicit digital currency.” Haney was allegedly one of those criminals. Melendez concluded:

“HSI special agents employed blockchain analytics to uncover and seize bitcoins valued at $19 million and usher Haney out of the dark web shadows to face justice in the Southern District of New York.”

The press release suggests that Haney operated on Silk Road under the pseudonym Pharmville. U.S. law enforcement reportedly made multiple controlled purchases of narcotics, including oxycontin, from Pharmville in 2011 and 2012. Those purchases resulted in a judicially authorized search of Haney’s house in Ohio in 2018.

The investigation allegedly exposed evidence that Haney was a high-ranking member or administrator of the Pharmville account. In 2017 and 2018, Haney reportedly transferred his Bitcoin (BTC) proceedings to a cryptocurrency exchange. In correspondence with the exchange, Haney claimed to have obtained his BTC through mining and from individuals he met online.

When Haney exchanged his cryptocurrency for fiat currency and moved it into an HSI bank account, the funds were seized pursuant to a judicially authorized seizure warrant from a custodial account at a bank in the Southern District of New York.

As Cointelegraph reported earlier this month, $515 million in Bitcoin had been spent on illegal activities in 2019 as of the beginning of July, but this only accounted for 1% of total BTC transactions up to that point.

In May, German police, along with Europol, shut down servers of a dark-web marketplace and seized six figures in crypto from the arrested suspects.


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Authorities have arrested alleged Silk Road drug trafficker Hugh Brian Haney per an announcement from a New York district attorney