The bitcoin in question is said to belong to Ross Ulbricht, founder of the dark web marketplace Silk Road which was taken down in 2013. Silk Road was the most sophisticated marketplace for criminals on the dark web.
Ulbricht was found guilty of seven criminal counts in 2015 and given a double life sentence.
Get this - there is a Bitcoin wallet with 69,000 Bitcoins ($693,207,618) that is being passed around between hackers/crackers for the past 2 years for the purpose of cracking the password, no success so far.— Alon Gal (Under the Breach) (@UnderTheBreach) September 8, 2020
I have the wallet, @Google hook me up with a quantum computer please. pic.twitter.com/GcIqH7kN98
The existence of the bitcoin cache was first noticed by Alon Gal, chief technology officer at Israel-based cyber crime intelligence company Hudson Rock, who tweeted in September that a a bitcoin wallet was being passed around by hackers during the last two years with no success in cracking it.
The address that moved $1,000,000,000 worth of Bitcoin yesterday is possibly linked to Silk Road.— Alon Gal (Under the Breach) (@UnderTheBreach) November 4, 2020
If it was done by the owner/owners, it was probably done due to the headlines of my reports.
Owner - If you see my tweets, I'm accepting tips ;)
The US Department of Justice said in a media released on Thursday that it had filed a bid for forfeiture of the bitcoin stash which was filed in the US District Court of the Northern District Of California.
The court document said: "In 2020, law enforcement officers used a third party bitcoin attribution company to analyse bitcoin transactions executed by Silk Road. From this review they observed 54 transactions that were sent from bitcoin addresses controlled by Silk Road, to two Bitcoin addresses."
Personal opinion - this U.S Justice department seizure of the funds sounds really sketchy, I have no idea what's the story behind how they were able to suddenly retrieve these funds, or whether they were connected to Ulbricht.— Alon Gal (Under the Breach) (@UnderTheBreach) November 5, 2020
I hope they will release a detailed statement soon.
It said these transactions were done by someone called Individual X - whose identity the government knew - who stole the cryptocurrency from Ulbricht.
"According to the investigation, Ulbricht became aware of Individual X’s online identity and threatened Individual X for return of the cryptocurrency to Ulbricht. Individual X did not return the cryptocurrency but kept it and did not spend it," the document said.
The background to the Silk Road takedown was provided in the court document and based on this, the government said it was reasonable to assume that the bitcoin stash represented proceeds "traceable to computer hacking" which was illegal under American law.
This is how U.S. Justice decrypted Silk Road wallet. pic.twitter.com/4wZFyTWKDq— SttyK (してぃーきっず) (@SttyK) November 5, 2020