Finland’s government is preparing to hold its first Bitcoin auction.
The Treasury Department has recommended that the government auction off the approximately 2,000 BTC it seized in connection with drug busts nearly two years ago, according to a report from Finnish-language media outlet Helsingin Sanomat.
“We recommend public auction for the [sale of the] bitcoins. An auction can be used to ascertain the buyer and whether the state receives a payment. In addition, the risks associated with the handling of bitcoins will be passed on to the buyer in the auction, ” said Mikko Kangaspunta, chief of the government’s state treasury division, according to a rough translation.
The report states that the government seized the funds in June 2016, when the Bitcoin price was trading at roughly $600. The defendant in the case — Lasse Juhani Kärkkäinen — received more than 11 years in prison following a conviction for selling narcotics and performance-enhancing drugs on the now-defunct dark web marketplace Silk Road.
Kärkkäinen — from whom authorities seized 1,666 BTC during the bust — appealed that he should be allowed to forfeit the equivalent value of his holdings in euros, but an appellate court ruled that he must forfeit the coins themselves, which are now worth closer to $11,000 apiece.
As CCN reported, the government recently released new guidelines governing its handling of confiscated cryptoassets. Under the new framework, officials are prohibited from storing them in internet-connected wallets. This effectively forces them to adopt a cold storage solution, and it also prevents them from disposing of seized cryptocurrencies by selling them on exchanges.
According to the report, the Treasury wants to sell the bitcoins in a series of auctions to ensure that it achieves optimal pricing. At the current market value, the 2,000 BTC is worth approximately $21.4 million.
Finland is not the first government to auction off Bitcoins seized in Silk Road-related busts. The US Marshals Service auctioned off 144,336 BTC belonging to Silk Road operator Ross Ulbricht in a series of auctions during 2014 and 2015, netting approximately $48 million.