Bitcoin Firms Under Probe Over Silk Road Links


Bitcoin Firms Under Probe Over Silk Road Links

US authorities are investigating bitcoin exchanges, with several of them, including Mt. Gox having received subpoenas from federal prosecutors in Manhattan this winter. The exchanges are being probed for association with the internet-based drug market Silk Road.

The news that was first reported in the Wall Street Journal indicated that Mt. Gox has received subpoenas demanding details of customer-transactions and materials linked to the luring of investors.

Under the counsel of Mt.Gox’s lawyers, boss Mark Karpeles decided against travelling to the US in response to summon by a judge to testify for a class-action case, on fears that he would be apprehended in connection with the case, according to Reuters.

The prosecutors and Federal Bureau of Investigations agents are looking into whether Mt. Gox and other similar entities may have facilitated transactions linked to Silk Road, sources familiar with the matter said.

The probe is at an early stage and no conclusions have been arrived as yet to indicate that the exchanges were involved with Silk Road.


In April, a federal grand jury in New York indicted Charlie Shrem, a prominent bitcoin investor, after he was accused of sending funds to Silk Road.

Last year, the alleged founder of Silk Road Ross Ulbricht was arrested in San Francisco. He was charged with counts linked to drug trafficking, illegal access to computer systems and money laundering, activities that originated from his supposed involvement in the illegal market place that facilitated the purchase of drugs and criminal services in exchange for the virtual currency.

Silk Road was shut down by authorities after its founder was arrested.

However, ZDNet reported that it’s not yet known how many other virtual currency exchanges, if any, have received subpoenas from US authorities.

Silk Road only took bitcoin payments before it was shut down by the US government.

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