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Nearly $1B in Bitcoin Moves From Wallet Linked to Silk Road
A wallet possibly belonging to early dark net market Silk Road moved almost $1 billion worth of bitcoin early on Wednesday.
A wallet possibly belonging to early dark net market Silk Road moved almost $1 billion worth of bitcoin early on Wednesday, according to blockchain intelligence firm Elliptic.
STORY CONTINUES BELOW
- Bitcoin address "1HQ3Go3ggs8pFnXuHVHRytPCq5fGG8Hbhx" transferred 69,369 BTC to an unknown wallet. The transaction was also noted by Twitter bot @Whale_alert 11 hours ago.
- "These funds likely originated from the Silk Road," Tom Robinson, co-founder of Elliptic noted in a LinkedIn post, adding the coins may have been moved by imprisoned Silk Road operator Ross Ulbricht or a Silk Road vendor.
- This is the first transaction from the address since 2015 when it transferred 101 BTC to BTC-e – a now-shuttered cryptocurrency exchange allegedly favored by money launderers, per the post.
- Ulbricht – who operated under the pseudonym Dread Pirate Roberts – operated the dark net market website Silk Road from 2011 until his arrest in 2013 and is currently serving a life sentence.
- As such, it's highly unlikely Ulbricht executed the transaction.
- The bitcoin trove left Silk Road’s wallet back on May 6, 2012, but may have been moved to stay up to date with changes to the Bitcoin network.
- Robinson said in the post that an encrypted file containing what are claimed to be the cryptographic keys to the coins has been circulating on hacker forums.
- If the password has been cracked, then a hacker may have moved the stash or its owner moved them to avoid this happening.
- Silk Road, which combined two privacy-preserving technologies – bitcoin and Tor – to enable anonymous trade of illicit goods and services likely earned around 614,000 BTC in commissions.
- Of these, 174,000 BTC were seized from Ulbricht by the FBI when he was arrested in 2013.
- Robinson believes the remaining 440,000 bitcoins, now worth some $6 billion, may have been used by Ulbricht to fund expenses associated with running the marketplace.
- Big on-chain transactions related to malicious entities often raise concerns in the market. While bitcoin is down over 2% on the day at press time, those losses look to have been fueled by uncertainty around the U.S. election.
Also read: Silk Road Programmer Pleads Guilty to Making False Statements
Omkar Godbole
Omkar Godbole is a Co-Managing Editor on CoinDesk's Markets team based in Mumbai, holds a masters degree in Finance and a Chartered Market Technician (CMT) member. Omkar previously worked at FXStreet, writing research on currency markets and as fundamental analyst at currency and commodities desk at Mumbai-based brokerage houses. Omkar holds small amounts of bitcoin, ether, BitTorrent, tron and dot.
