German Authorities Sell $14mn in Cryptos

| Publish date: 06/01/2018
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Earlier this week, German media reported that local law enforcement sold confiscated cryptocurrencies, making about €12 million (~$14.02 million) from the sale. This was an emergency sale, since the treasury was worried about the massive fluctuations in current cryptocurrency prices. Emergency sales are usually reserved for perishable items such as food, or items like cars that depreciate in value.

The Background

The whole story started back in June of 2017, when the office of a platform illegally selling copyrighted e-books as well as audiobooks are dirt cheap prices – called LuL.to – was raided and shut down by the local police. The site was seized and blocked, the operators of the site arrested and all its assets were put into a fund that is usually used for police resourcing.

Local news agencies reported state prosecutors explaining that since all cryptocurrencies were subject to the high risk of fluctuations, and even complete losses, the Bayern Central Cybercrime Office had ordered an emergency sale of the seized cryptos.

In total, the German police sold off 1,312 BTC (Bitcoin), 1,399 BCH (Bitcoin Cash), 1,312 BTG (Bitcoin Gold) and 220 ETH (Ether), which totaled €12 million. The transactions were spread out across the last few months, starting from February this year. A total of 1,600 transactions were made by the authorities via a German based cryptocurrency exchange.

The sell-off commenced in late February, during which time, the price of Bitcoin and the other altcoins continued to slide. Bitcoin’s price when the first sale took place was $11,400, and then slipped to below $7,000 during the second batch and then another sale took place around the $9,000 mark.

Considering that the price of Bitcoin has once again fallen below $7,500, the German police made a good decision about selling off the cryptocurrencies when they did – unless, of course, Bitcoin makes a huge rebound.

Other Confiscations by Law Enforcement

This sale of these confiscated cryptocurrencies was a record breaking one for assets seized within Germany. However, on the larger scale, there have been much larger amounts hauled in by the authorities in other countries.

The US Justice Department, for example, made $48 million in October 2017, from its sale of the Bitcoins that had been confiscated from Ross “Dread Pirate Roberts” Ulbricht, the operator of the Silk Road drug market on the Dark Web.

One of the largest sales of confiscated cryptocurrencies ever was the one made by Bulgarian authorities in 2017. They made a massive $3.3 billion from the sale of seized digital assets, and the government was actually able to pay off 20% of Bulgaria’s national debt from the proceeds of this sale.

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