Feds track and seize billions in illicit crypto

Tens of thousands of innocent bitcoin are now sleeping safe and sound in their beds at home, thanks to a recent federal investigation. The DOJ seized more than $3.36 billion worth of the cryptocurrency late last year as part of a fraud case involving the Silk Road dark web marketplace, federal authorities announced yesterday. It's the second-largest crypto recovery in US history.

🌐 More details… The Silk Road was a dark web marketplace that facilitated the sale of illegal drugs and other illicit goods and services. From when it was created in 2011 until 2013, when the Feds shut it down, about 9.5 million bitcoins changed hands on the platform (context: it dealt exclusively in bitcoin).

More than 175,000 bitcoin ended up being seized by authorities as part of the initial investigation leading to the marketplace's closure, but it was suspected tens of thousands more were still missing.

• Last November, the FBI raided the home of a 32-year-old Georgia man named James Zhong and discovered over 50,000 bitcoin on a computer in his basement. Zhong later pleaded guilty to stealing the crypto from Silk Road in 2012.
• The agency declined to say how exactly it traced the stolen bitcoins to Zhong. But in previous high-profile cases, authorities tracked missing funds through different crypto wallets until they found exchanges where the suspects had input their real names.

📉 Zoom out: In a prime example of how crypto hasn't favored the bold, the Feds’ $3.36 billion seizure is worth around $1 billion today – a ~70% drop.

+Dive deeper: Crypto is often hailed as an anonymous way to do business… but that’s only partially true.