When law enforcement agencies target online criminals, there is usually a link to Bitcoin. In several cases, these agencies effectively manage to gain control over criminals’ Bitcoin holdings. Those funds are usually auctioned off to the highest bidder. In the UK, the first such auction took place this week. An intriguing development, primarily because other currencies were part of the deal as well.
The TalkTalk Incident
Several cyber-attacks plague society every single day. While not every attack proves to be successful, those that are often caused major damages. In the United Kingdom, the TalkTalk hack has gained a hefty reputation of its own. Numerous customers’ records were lifted from the provider and resold on the darknet. The person responsible for this hack is known as Elliott Gunton. This particular darknet user has built up quite a repertoire over the years, eventually leading to his arrest.
Gunton was found guilty of providing hacking service in exchange for Bitcoin, Ether, and XRP. Additionally, he also sold the customer records from the TalkTalk hack online, earning him a hefty penny. It is believed Gunton owed over $450,000 worth of Bitcoin alone at the time of his arrest. Given the drop in price over the past 18 months, the total holdings were sold off for a much lower price.
The Successful Auction
It is interesting to note how this was the first seized Bitcoin auction in the UK. In the United States, these auctions have become somewhat notorious. The US Marshals auctioned off various lots of funds obtained from Silk Road operators over the years. It is evident that this business model has inspired other governments to take a similar approach. It is a viable strategy, as these law enforcement agencies cannot hold on to the cryptocurrencies themselves.
This particular auction was conducted as part of the ERSOU asset recovery process. The ERSOU is the Eastern Region Special Operations Unit. Although all assets have a value of up to $600,000, they were sold for roughly $300,000 when everything was said and done. A bit of an underwhelming tally in the end, but one has to keep in mind cryptocurrencies and digital assets continue to fluctuate in value. As such, this appears to be a fair value, as the assets were sold in various sized lots.
Massive International Attention
As is usually the case where these types of auctions are concerned, there is plenty of international interest. It is expected over 7.500 bids were received spread out among the different lots. Noteworthy interested parties originated from Brazil, Australia, the US, Canada, Singapore, and Dubai. This further confirms cryptocurrencies are still of global interest primarily when they can be bought on the cheap.