"What is the credibility of the news that the U.S. Department of Justice has approved the sale of Silk Road bitcoins?"

Author: Jessy, Jinse Finance

On the morning of January 9, as the market declined, major cryptocurrency media outlets reported a piece of negative news: "The U.S. Department of Justice has approved the sale of $6.5 billion worth of Bitcoin seized from the Silk Road on the dark web." Following this news, Bitcoin dropped below $94,000.

When it rains, it pours; the cries within the community are incessant. However, after verifying this news, Jinse Finance found that the credibility of the news source is low, and the reporter could not find any official confirmation from the U.S. Department of Justice. Even if the news were true, based on past procedures for the Department of Justice selling confiscated Bitcoin, it would be nearly impossible for them to sell these Bitcoins in the short term, that is, before Trump takes office. Trump has already promised that during his presidency, the U.S. will not sell any Bitcoin.

In summary, the U.S. Department of Justice is not likely to sell Bitcoin at this stage, and it will not create selling pressure in the market.

There is only one source of information

According to reports from major cryptocurrency media outlets, it can be found that the linked news sources are all from a personal blogger on X.

The main entity of this account is a cryptocurrency news media outlet, but access to their website requires a subscription, and the membership fee is not low.

Based on the above information, Jinse Finance reporters believe that the credibility of this media outlet is already low, and the brief statement from their X account, "The U.S. Department of Justice has approved the sale of $6.5 billion worth of Bitcoin seized from the Silk Road on the dark web," does not specify a concrete source and thus cannot be verified.

Even if the news is true, the Department of Justice cannot sell its Bitcoin in the short term

Jinse Finance reviewed the previous processes of the U.S. Department of Justice for selling confiscated Bitcoin and found that even if this news were true, the Department would essentially be unable to sell its Bitcoin before Trump takes office.

The Bitcoin seized by the U.S. Department of Justice is generally auctioned off by the U.S. Marshals Service, rather than being sold directly through OTC or exchanges. This is similar to how judicial departments auction off seized properties and other assets for profit, which are then remitted to the national treasury.

Taking the 2020 U.S. Marshals auction process as an example, approximately 4,040 Bitcoins were auctioned off, which were involved in various federal criminal, civil, and administrative cases.

At that time, the announcement of the auction of these Bitcoins was made on February 3, 2020, requiring potential bidders to complete registration by February 12, with the auction taking place on February 18.

According to the specific sales terms published by the U.S. Marshals at that time, the winning bidder was required to wire the purchase funds to USMS by February 19, 2020, and USMS would not transfer any Bitcoin until it confirmed receipt of the buyer's funds.

This means that from the announcement to the actual auction, and then to the winning bidder receiving the Bitcoin, it could take more than half a month before they could sell it on the market.

Currently, there are only 11 days left until Trump takes office, and Jinse Finance reporters did not find any recent news about the auction of confiscated Bitcoin on the U.S. Marshals' official website.

It is evident that at least before Trump takes office, the U.S. Department of Justice will not actually sell the confiscated Silk Road Bitcoins.

In conclusion, the widely circulated news this morning, which affected the market, "The U.S. Department of Justice has approved the sale of $6.5 billion worth of Bitcoin seized from the Silk Road on the dark web," is likely to be false.