The US Supreme Court has refused to hear an appeal by Battle Born Investments over the seizure of 69,370 bitcoins originally linked to the Silk Road darknet market. The decision, listed under “CERTIORARI DENIED” in the Supreme Court's October 7 decision publicationIt effectively allows the US government to confiscate and potentially sell the Bitcoins, currently valued at approximately $4.4 billion.
US Government Retains Right to Seized Bitcoins
The case revolves around a civil forfeiture action brought by the US government following the closure of Silk Road. Battle Born Investments claimed legal ownership of the Bitcoins, stating that in March 2018, they had entered into an agreement to purchase assets, including the Bitcoins in the “1HQ3” wallet, from the Chapter 7 bankruptcy estate of Raymond Ngan. They allege that these assets were linked to an individual known as “Individual x,” who had stolen the bitcoins from Silk Road and was associated with Ngan.
However, US authorities disputed Battle Born's claims, maintaining that the Bitcoins were subject to confiscation due to their connection to illegal activities on the Silk Road. In 2022, the U.S. District Court for the Northern District of California ruled in favor of the government and ordered that it must “dispose of the property seized from the defendant in accordance with law.”
Battle Born Investments appealed the decision, but on August 18, 2023, the Ninth Circuit Court of Appeals affirmed the lower court's ruling. The appeals court determined that Battle Born “did not have standing to challenge the seizure,” stating that his claims were speculative and lacked substantial evidence to establish direct ownership of the Bitcoins.
Following the appeals court's decision, Battle Born requested a rehearing en banc, which was denied on December 12, 2023. Persisting in their legal efforts, they filed a petition for writ of certiorari with the Supreme Court on April 25, 2023. 2024, arguing that the lower courts had erred in their interpretation of his position and ownership claims.
The Supreme Court's refusal to review the case effectively upholds the decisions of lower courts. By denying the petition, the Supreme Court confirms that Battle Born Investments lacks the necessary standing to challenge the confiscation of the Bitcoins. This result moves the 69,370 btc from a seized state to a seized and salable asset, giving the US government the authority to “dispose of the defendant's seized property in accordance with the law.”
The government's position, supported by filings from the U.S. Department of Justice, emphasized that “mere assertions of ownership, without substantial evidence, are insufficient to establish standing in civil forfeiture cases.” The courts agreed, highlighting the need for concrete evidence linking the claimed assets directly to Battle Born.
The possible sale of 69,370 btc by the US government could have major implications for the market. Valued at approximately $4.4 billion at current prices, the liquidation of such a large amount of bitcoin could influence market dynamics and investor sentiment. In the past, US government sale news has greatly agitated the market.
Notably, Donald Trump promised to transfer all seized bitcoin to a “strategic national reserve.” Following this, on July 29, the Biden-Harris administration transferred 29,800 bitcoin to an unknown wallet address.
At the time of publication, btc was trading at $62,356.
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