The United States Marshals Service announced recently that it would be auctioning off the nearly 30,000 Bitcoins that it stole from the Silk Road, a Bitcoin marketplace that used to exist on the dark web. The feds acquired those funds last October when they finally shut down the black market and captured its leader, Dread Pirate Roberts, a.k.a. Ross William Ulbricht.
According to the announcement, the sale of the coins will consist of three phases. The first, bidder registration, will last for one week, beginning June 16. Anyone who wishes to bid must complete and submit a detailed registration form with all sorts of information like a Taxpayer Identification Number, bank account numbers, an address, and more. In addition, applicants must send along a copy of their government-issued photo ID and a whopping $200,000 deposit. This huge restriction will prevent many people from having any chance at taking part in this auction, so not just anyone will be able to nab some cheap coin here.
The second phase of the sale will be the actual auction. This will last for exactly twelve hours on June 27. Approved bidders will be asked to fill out, sign, and submit an online bid form. They will be bidding on a total of ten lots of Bitcoins. Nine will consist of exactly 3,000 BTC and the last, roughly 2,650. The highest bidder will win as many lots as he wishes. If any are left over, they will go to the second highest bidder and so on.
During the third and final phase of the auction, the winners will send their payments to the USMS via bank wire and the coins will then be delivered. Some interesting terms of sale were also mentioned in the announcement. The USMS said that only cash will be accepted and no financing terms will be considered. Buyers must pay their own Bitcoin transaction fees and funds will not be sent to any public address that is obscene or apparently foreign or associated with any criminal activity. The USMS also reserved the right to reject any bid for any reason whatsoever.
Another interesting note is that these funds are only those stolen directly from the Silk Road and its users. This auction does not include Ulbricht's personal coins. It is likely that his own money is still inaccessible to police or perhaps it is still part of an ongoing investigation. Check out this article to read more about how the Silk Road was shut down and how Ulbricht was discovered and captured.
If you really want to get your hands on some of these coins but cannot afford the $200,000 deposit, you may be able to find some help over at bitcointalk.org. A few threads have already popped up over there proposing group buys and some of them may be successful. Happy bidding!