Agents from the U.S. Justice Department have seized bitcoin worth more than $1 billion, the largest-ever seizure of illegal cryptocurrency.
The seized bitcoins were reportedly linked to accounts of the now-defunct Silk Road website, an online marketplace on the dark web used by criminals to purchase illegal services and goods such as hacking services, espionage, drugs and guns.
Federal agents said that they had seized 69,370 bitcoins from the accounts. Each bitcoin is valued at more than $15,000. According to court documents, all of the seized bitcoin will be forfeited to the government.
Most of the bitcoin reportedly belonged to Silk Road's founder, Ross Ulbricht. He was arrested in 2013 and sentenced to life in prison in 2015. After a lengthy trial, Ulbricht was convicted of money laundering, computer hacking and drug trafficking.
The Federal Bureau of Investigation shut down Silk Road in 2013. The website only allowed transactions using bitcoins as it is impossible to trace the identity and location of the sender and recipient. During its time, Silk Road was considered to be the most notorious online criminal marketplace, used by dictators, terrorists, gangs and other criminal groups.
"The successful prosecution of Silk Road's founder in 2015 left open a billion-dollar question. Where did the money go? $1 billion of these criminal proceeds are now in the U.S.," U.S. Attorney David Anderson said in a statement.
The bitcoins were not taken directly from Ulbricht's accounts but from an unidentified hacker who stole it from Silk Road before it was shut down. Court documents revealed that the hacker was only known by his online name "Individual X." At the time of the online heist, the bitcoins were worth around $14 million, when the cryptocurrency was worth $200 each.
Court documents said that Ulbricht was made aware of the heist and pursued the hacker online. He reportedly threatened Individual X, demanding that he return the bitcoin. Individual X ignored Ulbricht's threats and held on to the stolen bitcoin. He reportedly did not spend it even when prices rose in the following years.