US Marshal office continues to auction seized Silk Road Bitcoins

The US Government is continuing its Bitcoin proponency by holding auctions in which the United States Marshals Service has sold units of the virtual currency which was seized from the ill-fated anonymous marketplace Silk Road.

On March 5th, 2015, the United States Marshals Service concluded its third online auction of of this type.

The sealed bid auction was for 50,000 bitcoins divided into two series. The first series comprised ten blocks of 2,000 bitcoins and the second had ten blocks of 3,000 bitcoins.

Bidders were required deposit US$100,000 for the first series and US$150,000 for the second series. The total number of bids stood at 34 from 14 bidders, and the value of the bitcoins at current market rates amounted to almost US$14 million.

The government had 14 registered bidders for the 34 bids received, said Marshals Service spokeswoman Lynzey Donahue in a report by Reuters late last week, a result which ixs higher than the bids received at the last bitcoin auction in December, when just 11 buyers submitted 27 bids.

One of the bidders was SecondMarket, Barry Silbert’s New York based company that provides transaction software to private companies and investment funds looking to do tender offers or share buybacks, although the firm did not win any of the bids that it placed.

Those who placed winning bids and those who did not were notified on Friday last week, however the US Marshals Service do not disclose their names. SecondMarket and Silicon Valley investor Tim Draper won 80,000 bitcoins in the agency’s two previous auctions.

Whilst Barry Silbert’s firm had indicated that it wished to participate in last week’s auction, it had not created a syndicate. The firm wished to bid for 48,000 of the Bitcoins.

Pantera Capital, an investment fund founded by Dan Morehead, a former senior executive at hedge fund Tiger Management, stated its intention to participate in its newsletter and subsequently formed a syndicate for the auction.

Meanwhile, billionaire venture capitalist Tim Draper, winner of the past two auctions, did not submit a bid. He did state in an email to Reuters that the Bitcoins on the auction block are “probably…the best deal anyone will get.”

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