In an announcement made today by the National Agency for the management of Seized assets (ANABI), seized Bitcoin and Ether are going to be auctioned away soon. The agency made it clear that it will start the process of auctioning of Bitcoin and Ether that was seized in a fraud case whose details cannot be disclosed as of now. A local news report had stated that the ANABI expected the winner to give addresses that are related to the cryptocurrency exchanges. These exchanges should use the KYC procedures in order to ensure all the preconditions and requirements of the country’s laws and regulations are met. The laws would be related to the country’s financial laws and any such measures that help fight money laundering.
For Romania, this is the first time it is seizing Bitcoin and Ether but countries around the world have seized Bitcoins earlier and most of these times, the Bitcoins were connected to criminal activities. In 2017, the Australian Police had confiscated 24,518 BTC which was a crime seizure. Ernst And Young came forward and announced the auction of 24,518 BTC in that case. A year later, the Bulgarian law enforcement agency seized nearly 213,000 BTC which also was later auctioned.
If it is a criminal case, then the US government also sells off the confiscated crypto in auctions conducted by US Marshals Service. Early this year, the US Federal agency received a load full of flak and criticism after it revealed that it has auctioned 4,041.58424932 Bitcoin for $38 million. The auction took place in February this year, at a time when the coin was hovering near the valuation of $9.2k. Jameson Lopp, the Co-founder, and CTO of Casa tweeted to explain how the US Federal agency went about to sell off the BTC at such a low price. He also explained how it missed out on more than $1.7 million by engaging in an early auction!.
Last year in September, the UK police had also auctioned nearly $300,000 worth of cryptocurrencies which they captured after they were confiscated by the country’s Eastern Region Special Operations Unit (ERSOU). Since 2014, the law enforcement agencies all around the world have started to auction large sums of Bitcoin seized during criminal investigations. Governments globally have been very stern about this and do not want digital assets used in crimes. In contrast to the procedure of unloading these confiscated coins, there are many types of investors who are interested to bid for such seized coins.
Figuring out what needs to be done with the seized cryptos also is a decision the government has to make. Like we discussed earlier about the Australian seizure, it took a while before the government could decide what it wanted to do with the coins confiscated from a drug dealer in 2013. An economic historian at the Cambridge Center for Alternative Finance, Garrick Hileman, said after the sale announcement in Australia that when the government is selling crypto, it is being perceived as an asset.