Minimizing Market Impact with OTC Deal
With over 3.4 million Twitter followers, Sun proposes to buy the government-seized Bitcoin at a 10% discount in an over-the-counter (OTC) deal. He aims to minimize the potential influence of such a massive sale on the cryptocurrency market.
US government has announced its intention to sell an additional 41,500 #BTC this year. To minimize the potential impact on the market, I would like to offer to purchase these BTC at a 10% discount for an OTC deal.
— H.E. Justin Sun 孙宇晨 (@justinsuntron) March 31, 2023
Government’s Plan to Sell Seized Bitcoin
The US government’s announcement comes after the seizure of approximately 51,351 BTC from hacker James Zhong. Zhong was accused of stealing the digital assets from the now-defunct Silk Road illicit marketplace in 2012. On March 14th, the government sold about 9,861 BTC of the total amount, worth more than $215 million. The remaining 41,491 BTC, valued at over $1.14 billion at the current price of $27,588, are still to be sold.
Background on the Bitcoin Seizure
The recent disclosure on the seized Bitcoin comes from a filing with the U.S. District Court for the Southern District of New York, relating to Zhong’s sentencing. The government will not sell the remaining Bitcoin until after Zhong’s sentencing, scheduled for April 14th.
Zhong was accused of stealing Bitcoin by exploiting the Silk Road’s payment processing system using fake accounts and rapid deposits followed by larger withdrawals. He pleaded guilty to committing wire fraud in connection with the theft.
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Silk Road: A Darknet Black Market
Silk Road operated as a darknet black market between 2011 and 2013, often associated with illegal activities such as money laundering and drug trafficking.
What is Justin Sun proposing?
Justin Sun, the founder of Tron (TRX), is offering to buy more than $1.1 billion worth of Bitcoin (BTC) that the US government plans to sell, suggesting a 10% discount to minimize the potential market impact.
Why does the US government have Bitcoin?
The US government has possession of approximately 51,351 BTC seized from hacker James Zhong, who was accused of stealing the digital assets from the now-defunct Silk Road illicit marketplace in 2012.
What was Silk Road?
Silk Road was a darknet black market in operation from 2011 to 2013, often associated with illegal activities such as money laundering and drug trafficking.