Previously identified Silk Road Bitcoin wallet is now actively moving BTCs
Image source: pixabay - 8moments
While the crypto news seems to be covered mostly with Bitcoin's price gains in the past week, I have been searching for answers as to why Bitcoin prices may have been moving up.
The Bitcoin community has been alerted by the recent active Bitcoin wallet belonging to the creator of Silk Road, Ross Ulbricht (aka Dread Pirate Roberts). Last year, the US Justice Department claimed 144,336 Bitcoins obtained after shutting down the notorious online drug market Silk Road in 2013. Source: Fortune - Jeff John Roberts.
Almost 30,000 BTCs were auctioned off by the government and won by venture capitalist Tim Draper.
The U.S. Attorney’s office did not specify if the proceeds from the seizure will go to the agencies, including the FBI and IRS, that helped bring down Silk Road, or if the money will instead go to the U.S. Treasury.
Source: Fortune - Jeff John Roberts
A few days ago, reddit user sick_silk alerted the community of wallet activity from the Silk Road wallet that contains 111,114 BTCs. The user commented that "Last movements on these subwallets are 4 years and 5 months old (March 9th, 2014)," and now "The chunks have been divided over time to 60,000 coins then to 30,000 / 20,000 / 10,000 / 5,000 / 500 and now 100 coins".
Due to the fact these Bitcoins were not auctioned off by FBI, the FBI or someone with access to the Silk Road wallet, is planning to move the Bitcoins to other locations. Other theories of who the wallet belongs to include previous cold wallet of the Mt. Gox, an early adopter's wallet or even Craig Wright's wallet.
Image source: pixabay - FdoPrado
The systematic process of splitting the coins into addresses of exactly 100 BTCs has raised suspicions as the intention of these deliberate splits were questioned. Another guess was that Silk Road still possesses this wallet:
Ross Ulbricht, the person who was actually convicted for running Silk Road, wasn’t the only person who ever ran the site. Others, who may have been more adept at evading the FBI, may have had control of this particular wallet.
Source: cryptoinvest - Miguel Gomez
Reddit user sick_silk further updates his post, noting that at least 15,593 BTCs originating from the 111,114 BTC wallet has made their way to the Bitcoin exchanges Bitfinex and Binance. 11,114 BTCs are now on Bitfinex wallet, 4,421 BTCs on Binance and some remaining BTCs on BitMEX exchange.
In an counter-argument, reddit users have not been totally convinced by user sick_silk, as the account was created 4 days ago to post this piece of information about the 'Silk Road' wallets. One user, Burglione, even commented that "I think [sick_silk] his incentive is to create FUD because he sold his coins and wants the price to go back down so he can buy back."
All these BTC movements could have sparked the price pumps for the past week, as we see Bitcoin prices moving beyond the $7,000 mark for several days. The exact intention of this Bitcoin dump is still unclear, but we could see it unravel in the next few days.
Image source: pixabay - broesis