Best Bitcoin Card for Bulgaria
It was a report that barely made it into the secondary columns of a daily newspaper: in May the Bulgarian authorities struck a blow against organised crime. Criminals had installed a virus on computers at Bulgarian customs. This allowed them to smuggle goods into the country without paying customs duties. So far, so unspectacular. The list of confiscated goods then reads very commonly: computers, files, tablets, bank documents, five million euros – and exactly 213,519 Bitcoin.
That’s more than one percent of all Bitcoin. In May, they were already worth more than 400 million euros. Due to the exorbitant jump in the price of the digital currency, however, at today’s prices it is already around 2.9 billion euros. This makes Bulgaria a large Bitcoin owner, if not the largest Bitcoin owner in the world. Of course, this cannot be validated exactly because the Bitcoin network is anonymous.
A sale could push down the price
What to do with so much money? Bulgaria could use the money to pay almost 20 percent of its national debt, which amounts to around 15 billion euros. And this is where things are getting complicated for Bulgaria. The country itself has no plans about what to do with the unexpected wealth. There are also very simple legal reasons for this: The proceedings against the customs fraudsters have not yet been concluded. The Bulgarian state has confiscated the Bitcoin treasure, but it is not yet the owner.
But even then there are still technical hurdles. They also need the fraudsters’ passwords if they want to sell them. It is unclear whether they are already in their possession. Even if they are solved, Bulgaria cannot sell such a gigantic amount of Bitcoin in one go. This would send price shocks through the markets, which would push the Bitcoin price into the basement. Currently about 3 million Bitcoin are traded per day.
The reserve currency of the legendary “Silk Road”
But Bulgaria is not the only or first country that Bitcoin has confiscated from criminals. The American FBI confiscated 144,000 Bitcoin as early as September 2013. They belonged to Ross William Ulbricht, the operator of the legendary “Silk Road”. On it you could trade anything from drugs and child pornography to weapons and contract killers – even a tank from the former Eastern Bloc countries was for sale there. In the “Silk Road”, Bitcoin was the lead currency, and transactions worth more than a billion dollars were concluded there. Ulbricht was sentenced to life imprisonment and imprisoned – with no prospect of parole.
The public prosecutor then sold the digital currency in four tranches between June 2014 and mid-2016 due to lack of experience. The whole thing was accompanied by several mishaps: For example, the Ministry of Justice unintentionally published the bidders’ list and exposed some of the big names from Silicon Valley who want to increase their digital treasure. Leading employees of Yelp, Second Market or Coinbase were therefore interested in the seized Bitcoin. But banks and hedge funds also look to the digital motto, including BNP Paribas and the Little Phoenix Investment Group. In the course of the auctions, two FBI agents stole 1606 Bitcoin in 2015. The two former FBI agents are now in prison for two and six years. Bulgaria would therefore do well to take the United States as its role model only to a limited extent.