$31M Bitcoin Donation to Ross Ulbricht Traced to AlphaBay, Not Silk Highway

Ross Ulbricht, the imprisoned founding father of the Silk Highway darknet market who was granted clemency by US President Donald Trump earlier this yr, acquired a whopping $31 million Bitcoin donation from an nameless pockets over the earlier weekend.

The sizable reward, despatched lower than 5 months after Ulbricht’s sentence was commuted, instantly sparked hypothesis that he had covertly reclaimed outdated Silk Highway earnings.

Nameless Bitcoin Present to Ross Ulbricht

In line with the intel shared by cryptocurrency tracing agency Chainalysis with WIRED, the 300 BTC donation didn’t originate from Silk Highway in any respect. As an alternative, the funds seem to hint again to AlphaBay, a now-defunct darknet market that operated between 2014 and 2017, effectively after Silk Highway’s takedown.

AlphaBay, which was reportedly ten instances the dimensions of Silk Highway at its peak, was identified for trafficking in medicine, malware, and unlawful companies. Phil Larratt, Chainalysis’s director of investigations and a former UK regulation enforcement official, stated there are “affordable grounds to suspect” the Bitcoin got here from somebody concerned with AlphaBay – seemingly a former vendor, given the dimensions of the quantity.

Outstanding blockchain investigator ZachXBT, who had earlier examined the donation, additionally concluded the funds didn’t come from Silk Highway.

Regardless of the sender’s use of Bitcoin mixing companies, ZachXBT traced the BTC to a pockets beforehand flagged by Chainalysis as linked to illicit exercise. He shared his conclusion with WIRED, whereby he famous that the donation itself could also be real, however “not reliable funds.”

Extra clues counsel the individual behind the switch might have been actively attempting to keep away from detection: ZachXBT found the identical particular person had beforehand cashed out different crypto by way of centralized exchanges in small, spread-out quantities, relatively than massive single transactions. This conduct is according to an effort to evade asset freezing or scrutiny.

AlphaBay Crackdown

Chainalysis reportedly declined to share specifics on how precisely it linked the donation to AlphaBay.  However you will need to be aware that the agency is broadly identified for its experience in mapping illicit exercise throughout blockchain networks and performed an important position in dismantling the now-defunct market through the multinational regulation enforcement initiative generally known as Operation Bayonet, involving the FBI, DEA, and Europol.

The crackdown later led to the conviction of Bryan Connor Herrell, an AlphaBay moderator, who was sentenced to 11 years in jail. As for Ulbricht, he has not publicly addressed the donation.