The FBI cracked down on reputed underworld bazaar, “Silk Road,” on October 1, 2013, seizing the website and $3.6 million worth of Bitcoin assets, and arresting the website’s alleged operator, Ross William Ulbricht. Ulbricht is charged with using the website to participate in a narcotics trafficking conspiracy, a computer hacking conspiracy and a money laundering conspiracy.

  • Although the government alleges that all Silk Road transactions were carried out with bitcoin, it is notable that Ulbricht’s use of other technology was clearly intended to obscure the origins of transactions consummated on the Silk Road website. The mere use of bitcoins does not, in and of itself, provide the anonymity required to shield criminals from law enforcement scrutiny.
  • In the complaint, the government acknowledges that bitcoin and other similar digital currencies may be used for lawful commercial purposes.

Read the full update written by our Decentralized Virtual Currencies group.