DOJ Filing Sheds Light on $1,000,000,000 Bitcoin Transaction Linked to Silk Road

The US Justice Department is shedding light on a huge Bitcoin (BTC) transaction that moved nearly $1 billion worth of BTC from a wallet connected to the online criminal marketplace Silk Road, which was shut down in 2013.

The address in question, up until the point of the transaction, was the fourth richest Bitcoin address in the world.

One day after the BTC was moved, the US Justice Department (DOJ) announced that it was seizing the $1 billion worth of BTC in its largest cryptocurrency seizure to date.

The DOJ now alleges that the large sum of BTC was stolen from Silk Road in 2013 and claims to have identified the individual involved in the theft whom the agency refers to as ‘Individual X’ in its briefing.

“According to an investigation conducted by the Criminal Investigation Division of the Internal Revenue Service and the US Attorney’s Office for the Northern District of California, Individual X was the individual who moved the cryptocurrency from Silk Road.

According to the investigation, Individual 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 Individual X controlled.”

According to the DOJ, Silk Road creator and convicted felon Ross Ulbricht became aware of the theft in 2013 and threatened Individual X for the return of the stolen BTC. Individual X did not return the funds to Ulbricht, but on Tuesday forfeited the contents of the wallet to the DOJ.

The IRS says it was able to track down the entity in question by using a third party Bitcoin analyses company to interpret transactions involving Silk Road.

The third party firm found 54 unusual Bitcoin transactions that were unconnected to the sale or purchase of any illegal goods, reaching the conclusion that the funds were stolen from Silk Road. At the time of the theft the stolen BTC amounted to roughly $354,000.

The DOJ still must try its case against Individual X to keep its $1 billion BTC seizure.

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