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Blockchain, cryptocurrencies, and insider stories by TNW.

Aussie Feds seize arms dealer’s Bitcoin, profit 20-fold

Kerchinnggggg!!!!

Bitcoin, australian, afp, police, cryptocurrency, windfall, seize

Have you ever wondered what happens to the Bitcoin BTC that’s seized by police in drug cartel busts and other criminal investigations? In Australia, it’s been revealed that one case earned the police a twenty-fold profit.

According to figures shared in the Australian Federal Police’s yearly report, authorities began proceedings to seize AUD $7,300 (USD$5,000) worth of Bitcoin in 2016. However, by the time the police was actually able to get its hands on the cryptocurrency its value had increased to AUD$154,000 (USD$105,000).

That’s a whopping 2,000 percent increase!

The case began in 2016 when Australian authorities apprehended an individual suspected of running three firearms into the country. According to the AFP, the individual was paid for the weapons in Bitcoin, which was seized when the man was arrested.

In January 2018, the Criminal Assets Confiscation Taskforce and Criminal Assets Litigation teams in Brisbane “successfully restrained the Bitcoin, which at the time, was worth around AUD$7,300 (USD$5,000).

It took until November 2018 to fully secure the Bitcoin when the perpetrator finally agreed to forfeit the coins, following a drawn out litigation process. By that time though, it had dramatically increased in value by over 20 times.

The AFP reports that the value was subsequently deposited into the Commonwealth’s Confiscated Assets Account. The funds of which are used in crime prevention and are fed back into local communities.

As it happens, this was the first time the AFP seized Bitcoin as part of a criminal investigation. The windfall must have sparked their interest in cryptocurrency.

That said, it’s not impossible for other types of seized assets to increase in value during legal proceedings. Real estate, vehicles, jewelry, and even artwork could all be seized and increase in value by the time they are successfully liquidated, but few do so as quickly as Bitcoin.

It’s also worth noting that this could go the other way, too. Depending on when Bitcoin is seized, its value could be 20-times less by the time its sold and absorbed by the authorities.

Indeed, confiscating assets, especially cryptocurrency, from criminals should not be about making money. But if it was, surely authorities should pay attention to the markets to ensure it obtains a fair representative value of what was originally confiscated.

In another case in the UK, the police auctioned off seized Bitcoin for above market rates, raising $369,000.

Published October 23, 2019 — 08:07 UTC