US Government Auctioning off Bitcoins Worth $37 Million in 2 Weeks

The U.S. government has opened registration for the bidding of over 4,040 bitcoins, currently worth more than $37 million, which will be auctioned off on Feb. 18. The winning bidder will be notified on the same day. These bitcoins were forfeited in various federal criminal, civil and administrative cases, the U.S. Marshals Service explained.

Also read: Regulatory Roundup — New US Crypto Tax Bill, Central Banks Join Forces on Digital Currencies

US Government’s BTC Auction

The U.S. government is auctioning off some bitcoins this month. According to the announcement by the U.S. Marshals Service (USMS) which is holding the auction, approximately 4,040.54069820 bitcoins will be for sale. The USMS is a federal law enforcement agency within the Department of Justice (DOJ). The agency explained that interested parties are invited to submit a bid for purchase, adding:

This sealed bid auction is for 4,040.54069820 bitcoin … The required deposit to participate in this auction is $200,000.00 USD.

The auction is divided into four series. Series A consists of five blocks of 500 BTC per block, Series B has 10 blocks of 100 BTC each, Series C has 10 blocks of 50 BTC each, and Series D has one block of 40.54069820 BTC. Bidders cannot view other bids and cannot change their bids once submitted. At the current rate, the BTC up for auction is worth more than $37,436,660.

How to Participate in the US Government’s Auction

To be eligible to bid in the auction, interested bidders must register with the USMS and submit all required documents with deposits. Registration opened on Feb. 3 and will close on Feb. 12. The winning bidder’s deposit will be retained by the USMS and credited towards the purchase price. The deposits of other bidders will be returned to the original accounts from which they were received.

The online auction will take place on Feb. 18 from 8 a.m. to 2 p.m. EST. Bids must be an all-cash offer in U.S. dollars. The announcement details:

The USMS will endeavor to notify the winning bidder(s) by 5:00 PM EST on Tuesday, February 18, 2020.

However, the government agency warned that “the number of bids received and the complexity of the review process may require additional review time.” The winning bidder must wire purchase funds to the agency by 2:00 p.m. EST on Wednesday, Feb. 19. Failing to do so will disqualify the bidder and another winning bidder will be selected.

Seized BTC From Various Cases

The USMS also explained on its website where these digital assets came from, stating:

These bitcoins were forfeited in various federal criminal, civil and administrative cases.

These cases involved the Drug Enforcement Administration (DEA), the Internal Revenue Service (IRS), the Federal Bureau of Investigation (FBI), the Homeland Security Investigations (HSI) and the Customs and Border Protection (USCBP). Some of them were named, such as the U.S. v. Tyler Lee Ward (Case No. 18-cr-438), U.S. v. Ryan Farace (Case No. 18-cr-00018), U.S. v. Matthew Lee Yensan (Case No. 17-cr-00303), U.S. v. Alexandre Cazes (Case No. 17-cv-00967), and U.S. v. Ronald L. Wheeler, III (Case No. 17-cr-377).

The USMS is recognized as the U.S. government’s leader in the sale of cryptocurrency. It has conducted a number of digital asset auctions over the years, including one that disposed of the 144,000 bitcoins seized from the Silk Road darknet marketplace.

The first online government auction of seized bitcoins was held in 2014; the USMS sold 130,000 bitcoins valued at approximately $50 million at the time of the sales. In 2015, the agency conducted multiple online bitcoin auctions, selling nearly 174,000 BTC valued at approximately $67 million at the time.

The agency established a memorandum of understanding in 2016 with the Treasury Executive Office for Asset Forfeiture for it to handle the disposition of forfeited bitcoins emanating from the Treasury Forfeiture Fund. In its annual report for the financial year 2018, the agency declared that it sold a total of 5,883 bitcoins in two auctions for a total of $55.8 million, adding that it continued to be the lead custodian for the 22 different types of cryptocurrencies seized by the DOJ and the Department of Treasury.

What do you think of the U.S. government auctioning off bitcoins? Would you want to bid for some? Let us know in the comments section below.

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Images courtesy of Shutterstock and the USMS.

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