In Maryland, a federal court accused a dark web drug dealer called Xanaxman of laundering Bitcoin worth $137 million from jail.
The narcotics dealer, who has been in detention since 2018, is reportedly in jail for having laundered 2,933 Bitcoins. Farace, also known as Xanaxman, was previously detained on the dark web for selling Alprazolam. In November 2018, Farace, sentenced to surrender the 4,000 bitcoins he received through the sale of narcotics.
At that time, 1,688 Bitcoins were $16,800, but now they are worth $187 million. In addition, he was ordered to return $5.6 million worth of property and cash. Farace continued to launder money while serving a 57-month jail term in a federal indictment released on Wednesday.
During the indictment, Farace reportedly laundered drugs with the aid of his father, Joseph Farace. In relation to these accusations, a group of 59 Bitcoin was confiscated by the Drug Enforcement Administration in May. These Bitcoins now are worth more than $137 million.
It is unknown whether the government learned of Bitcoin holdings that the prosecution referred to during the trial or acquired Bitcoins while they were in prison.
US Government Auctions Confiscated Bitcoin
It is difficult to get accurate information on the dark web and cryptography. An estimate of approximately $800 million emerged from an effort by blockchain analytics company, Chainalysis. In order to determine how many cryptocurrencies actually transferred to dark web marketplaces in 2019.
In 2013, the FBI shut down the Dark Web Marketplace, Silk Road, which is famous for illicit drug purchases, due to FBI monitoring. At that moment, the FBI collected 173,991 Bitcoin’s (valued at $33.6 million); 444,000 Bitcoins are still missing. According to Elliptic, 70,000 Bitcoin mysteriously transferred in November 2020.
The US government auctioned confiscated bitcoin frequently at a premium. In 2014, the venture investor Tim Draper purchased 30,000 Bitcoin at an unrevealed price, confiscated from the Silk Road. Farace’s Bitcoin, yet to come on the market.
