It is often said that the best thing to do with Bitcoin is to just hold it. A Swedish prosecutor has purportedly learned that lesson the hard way following the auctioning of bitcoins that it seized from criminals in 2019.
Local media agency Sveriges Radio reports that authorities seized 36 bitcoins in 2019 when it convicted three men who realized the proceeds from selling drugs online. At the time of the seizure, the bitcoins were worth roughly 1.3 million SEK (the equivalent of $250,000). Given that this was the value of the assets at the time of confiscation, local laws require that this value be recorded and set aside as the amount that the convicted criminals owe to the State.
However, it has taken over two years for the Enforcement Officer in charge of the case to finally complete the legal proceedings associated with auctioning the bitcoins.
At this time, though, the value of Bitcoin has appreciated significantly against the Swedish kronor, meaning the government only has to sell roughly 3 bitcoins to recover the amount that the convicted men owe in the local currency. The excess of 33 bitcoins would have to be returned to the convicts who are serving jail terms of between four to six years.
Commenting on the development, Prosecutor Tove Kullberg noted that ‘it is unfortunate in so many ways, and the earlier decision has led to consequences’ that regulators were unable to foresee. She reportedly said,
It is unfortunate that it is this way. The lesson to be learned from this is to keep the value in bitcoin. That crime profit is 36 bitcoin, regardless of what value bitcoin has at the time.
Granted, the seizure was one of the first cases when Swedish authorities had to confiscate cryptocurrencies from a criminal operation, leading to confusion regarding how a prosecutor was supposed to handle the sales. Prosecutor Kullberg reckons that the government needs to invest in internal education about cryptocurrencies as the space would likely grow to a greater extent than it is today.
She adds, “As we increase knowledge within the organization – the fewer mistakes [will] happen along the way.”
