U.S Government Claim Responsibility for Seized $1 Billion in Bitcoin from Dark Web Marketplace Silk Road

The U.S Government last week claimed responsibility for the hack that left the digital wallet, belonging to the notorious Silk Road account short of about $1 billion worth of bitcoin. The digital wallet was initially emptied by an unknown hacker, and it wasn’t until 5th November 2020 that the U.S Department of Justice claimed responsibility for the hack, of about 70,000 bitcoins, as part of a civil forfeiture case targeting the Silk Road via the help of an unknown hacker referred to as “Individual X” in court documents.

Several reports claim that “Individual X” initially hacked the Silk Road’s payments system sometime between 2012 – 2013, refusing several threats for the return of the cryptocurrency by Silk Road’s creator Ross Ulbricht in the years that followed. “Individual X” subsequently agreed to forfeit the bitcoin to the US government and helped transfer the money on 3rd November 2020. It is unclear how the cooperation between the U.S Government and Individual X came about, or if Individual X was arrested.

US Attorney David L. Anderson in a press statement on the 5th of November celebrated the operation as a big success for the government. He stated, “Silk Road was the most notorious online criminal marketplace of its day”. Subsequently stating that; “The successful prosecution of Silk Road’s founder in

2015 left open a billion-dollar question. Where did the money go? Today’s forfeiture complaint answers this open question at least in part. $1 billion of these criminal proceeds are now in the United States’ possession.”

Silk Road is often remembered as being the biggest, most sophisticated, and extensive darknet criminal marketplaces that traded in illicit goods and services such as hacking-for-hire, narcotics, and contract-killing. In its hay days, the website generated around 600,000 bitcoins in commissions, 175,000 of these were seized by the U.S Government when Ulbricht was arrested, and the website shut down on October 23^rd, 2013 by the FBI. It was founded in 2011 by Ross Ulbricht, who is currently serving a double life sentence after being found guilty of his actions constituting seven criminal counts.

References

https://www.bbc.com/news/technology-54833130