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FBI shuts down alleged Bitcoin marketplace

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October 2
10:28 PM 2013

US law enforcement authorities had shut down an anonymous Internet marketplace known as "Silk Road". The Internet marketplace was known to be selling illegal drugs including heroin, cocaine and engaged in criminal activities. The authorities also arrested the owner of the online marketplace.

On Wednesday, the Federal Bureau of Investigation said that it had arrested Silk Road owner, 29 year old Ross William Ulbricht. The arrest was executed last Tuesday in San Francisco said court filings. Ulbricht appeared in court on Wednesday where a bail hearing was set for Friday. His lawyer refused to give statements regarding the case.

The FBI charged Ulbricht with narcotics trafficking conspiracy, computer hacking and money laundering conspiracy. This was according to the court filing, said a Reuters report.

Authorities seized USD3.6 million worth of bitcoin. Ulbricht used bitcoin instead of cash or credit card to complete transactions placed on Silk Road. His website had been said to have generated sales of more than USD9.5 million bitcoin. This was approximately equivalent to USD1.2 billion. An estimated USD15 million worth of transactions were done on Silk Road annually.

The FBI had seized the currency by taking control of Silk Road's digital wallets used to keep the bitcoin, added the Reuters report.

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