How true is the news that the U.S. Department of Justice approves the sale of Silk Road Bitcoin?

Author: Jessy, Golden Finance

On the morning of January 9, as the market fell, all major cryptocurrency media reported a piece of bad news, namely, "The U.S. Department of Justice approved the sale of $6.5 billion in seized darknet Silk Road Bitcoins." As soon as this news came out, Bitcoin fell below $94,000.

The house leaked, but it rained all night, and the circle kept wailing. However, after Golden Finance verified the news, it was found that the source of the news was not very credible. The reporter could not find any official confirmation from the U.S. Department of Justice. And even if the news is true, judging from the past procedures for the Department of Justice to sell seized Bitcoins, the Department of Justice is basically unable to sell these Bitcoins in the short term before Trump takes office, and Trump has already Made a promise that not a single Bitcoin would be sold in the United States during his term as president.

To sum up, the U.S. Department of Justice will not really sell coins at this stage, and it will not bring selling pressure to the market.

There is only one source of information

According to the sources reported by major cryptocurrency media, it can be found that the sources linked to them are all messages posted by X’s personal blogger.

The main body of this account is a news media in the currency circle, but the media needs to pay to browse its website, and the membership fee is not low.

Based on the above information, Golden Finance reporter believes that the credibility of the media is not high, and its X account posted a brief sentence "The U.S. Department of Justice approved the sale of US$6.5 billion of seized darknet Silk Road Bitcoins." Without identifying specific sources, it cannot be confirmed.

Even if the news is true, the Department of Justice will not be able to

sell its Bitcoins in the short term

Golden Finance reviewed and sorted out the U.S. Department of Justice’s previous process of selling the Bitcoins it had seized and found that even if this news were true, the Department of Justice would have been unable to sell the Bitcoins it held before Trump came to power.

Bitcoins seized by the U.S. Department of Justice are generally auctioned by the U.S. Marshals Service, rather than directly sold OTC or on exchanges. This is similar to how we have the judicial department conduct auctions of confiscated houses and other assets to make profits and then turn them over to the national treasury.

Let’s take the 2020 Marshals Service auction process as an example. At that time, approximately 4,040 Bitcoins were auctioned, and these Bitcoins were involved in various federal criminal, civil, and administrative cases.

At that time, news of the Marshals Service's auction of these Bitcoins was released on February 3, 2020. Potential bidders were required to complete registration before February 12, and the auction was held on February 18.

According to the specific terms of sale announced by the Marshals Service at the time, the winning bidder should be prepared to wire the purchase funds to USMS on February 19, 2020. USMS will not transfer any Bitcoin until it confirms receipt of the buyer’s purchase funds.

That is to say, it took more than half a month from the time the news was released to the actual auction, when the auctioneer actually got the Bitcoins and possibly sold them on the market.

At the moment, there are only 11 days until Trump takes office. Golden Finance reporters found no news of any recent auctions of confiscated Bitcoins on the official website of the Marshals Service.

It can be seen that before Trump came to power, at least the U.S. Department of Justice would not actually sell the Silk Road Bitcoins it confiscated.

To sum up, the "U.S. Department of Justice approved the sale of US$6.5 billion of seized darknet Silk Road Bitcoins" that was widely circulated this morning and affected the market is likely to be false.