Auction Of Crypto U.S. Seized From Huge Fraud Scheme

It’s the biggest deal of its kind. The U.S. has a stockpile of crypto that it has seized from illegal activity. The government has permission to liquidate it in an auction that will be coming soon. These auctions happen more than you think, but this one is the one to watch.

You’ve seen it in the headlines, “Authorities seize millions of dollars in property after raiding drug dealer’s home.” Unfortunately, not many people know what happens to that property after it has been seized. The answer is, the government holds an auction and turns it into profit. However, sometimes they hold onto the property for their use. Mansions, boats, and cars fall under this category. So undercover agents get to enjoy the life of driving fast cars and partying on yachts to play the part as they continue to fight the war on drugs.

Bitcoin that is not secured in cold storage and other digital currencies can be seized just like any other property. The Internal Revenue Service has a cybercrime unit just for this cause. More recently, seizures and auctions of crypto have gotten so grand that the government has sought help from the private sector. (Primarily to assist in the storage of all the digital currencies.) A Ponzi scheme involving former open-source cryptocurrency Bitconnect will be the next on the auction block.

The difference is that when the government auctions off the $56 million in crypto, the proceeds will be used to reimburse the victims. It’s about time the victims of crimes get restitution for damages. Typically, people get charged. They go to prison, and the victims are left to lick their own wounds. But, not this time. The victims will get their money back, and one of the men behind it all, Glenn Arcaro, faces about 20 years in prison. Further investigations might lead to more arrests.

The legal system needs to be on its Ps and Qs, though, if it’s going to seize crypto and then auction it. Don’t forget the payday this drug dealer enjoyed when he came out of prison after serving his time. The prosecutor argued in dollar bills at the time of the dealer’s conviction. As a result, some of the Bitcoin seized from him went to pay his fine. Unfortunately, not stating the value of Bitcoin at the time was the prosecutor’s downfall. The dealer was owed $1.5 million because the value of Bitcoin skyrocketed while he was in prison.

Don’t get taken by Ponzi schemes. Byte Federal is the place for all your cryptocurrency needs. Go bank, Yourself.