€1.5m / $1.8m Worth of Bitcoin Seized in Dublin Drug Raid

By November 7, 2014Bitcoin Politics
Click here to view original web page at bitcoinmagazine.com

Less than a mile from my home, as the Web Summit wrapped up in Dublin’s RDS, Gardai (the Irish police) raided an office in the leafy suburbs. Two men were arrested as part of an international operation targeting drug sellers using Tor, and several hundred thousand euro in cash, as well as quantities of of drugs were seized, along with computer equipment. This was part of a broader international operation called “Onymous” between the US and sixteen European countries and Europol, which has shut down Silk Road 2.0 and over 400 other darknet websites. A number of arrests have also taken place, including Blake Benthall, said to be behind Silk Road 2.0.

The police raided the operation after three months of surveillance, and caught them red handed, with everything unlocked and the silk road website open. They have said in the news reports that this is the first time they have identified and seized drugs, despite encrypted communications being in place. The computers seized were encrypted but wide open, allowing the computer forensics team to rapidly get the data. This has netted the police and their international partners on the operation, dubbed “Operation Charge”, access to an entire history of drug sales via Silk Road-esque websites lurking in different areas of the darknet. Even more significant is the fact that, again according to radio reports, approximately €1.5m / $1.85m worth of bitcoins were also seized in the wallets that resided on a seized computer, alongside information about offshore bank accounts in Switzerland, Belize, Poland and other countries in a follow up search.

Ireland has a long history of dealing with assets derived from the proceeds of crime. After the murder of Irish Independent journalist Veronica Guerin in 1996, the Criminal Assets Bureau was established to deal with the proceeds of crime, which have now been dealing with assets such as properties, cash, cars, paintings and other high value goods. But while the Irish Police may have dealt with small amounts of bitcoin seized in the past, this time around it now has approximately 12% the amount that was seized in the FBI’s first Silk Road raid, and the dispatch addresses to go with them.

The scale of this operation has swiftly removed a large portion of the more unscrupulous parts of the criminal ecosystem from the net, but it will also bring the privacy of bitcoin into the limelight once again. In this case, some people are probably going to be nervous, as the corresponding information and communications between users of this service has been seized, along with the wallet and corresponding logs.

So what will happen next? Will there be further arrests because of the logs seized in Dublin after they are shared with international police? Or does the ease in which the tech savvy elements of the Irish police force identified and then tracked down this operation – despite all attempts at encrypting and masking their trails – show that the wild west era of Bitcoin’s development is coming to a close, or a harbringer of more to come?

The Washington Post has also wrote that this takedown will make the world a more dangerous place and the multi-headed hydra will emerge as new people jump at the opportunity to reap the profits from this underground market.

Do you think this will have a positive or negative affect on bitcoin’s fluctuating price? Let us know your thoughts in the comments below!

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