US Government to Sell Off $10 Million in Seized Bitcoin and Bitcoin Cash

The U.S. government is planning to sell off confiscated bitcoins seized during an opioid drug case that are now worth almost $10 million in the wake of the recent spike in prices.

The U.S. Attorney's Office in the state of Utah is now working quickly to sell the 513.1490393 bitcoins BTC$66,975.57, worth approximately $8.7 million at current prices, according to CoinDesk's Bitcoin Price Index. An almost equal number of BCH$561.33 is also to be sold (512.9274588), having a value of close to $949,000.

According to the court order:

"The BTC and BCH have been transferred to a government wallet. Due to the volatile market for cryptocurrencies, the BTC and BCH risk losing value during the pendency of the forfeiture proceedings ... For these reasons, the United States seeks an interlocutory sale."

The order further said that cryptocurrencies will be sold and converted into US dollars using one or more commercial cryptocurrency exchanges in increments of 50 coins or less, in a move to safeguard against loss or fraud. The sale proceeds will be deposited into the Treasury Forfeiture Fund Suspense account.

As per the court documents, U.S. district judge Dale Kimball approved the sale of confiscated cryptocurrencies on Dec. 12 after the prosecutors in the case filed a request for the sale on the same day.

The case involves a Utah man, Aaron Shamo, who was charged with running a multimillion-dollar opioid drug ring out of a Salt Lake City suburb in Nov. 2016, and was considered among the largest busts of its kind in the country, an Associated Press report says.

Shamo and his alleged partner, Drew W. Crandal, were accused of selling fake prescription drugs on a dark web marketplace. The seized bitcoin gains were worth less than $500,000 when Shamo was arrested, another AP report states.

Back in 2015, the U.S. government held several auctions of bitcoin obtained through its investigation of the now-defunct dark market Silk Road. In September, the government finally acquired possession of the proceeds from those auctions after a long legal battle with convicted Silk Road operator Ross Ulbricht, who had sought to regain possession of the funds.

In June, the South Korean government also sought to auction 216 bitcoins confiscated during a 2016 criminal investigation.

Utah courthouse image via Shutterstock