The federal government plans to auction about 30,000 bitcoin, valued at about $18 million worth of virtual money, on June 27, the U.S. Marshals Service said.
The bitcoin were seized during an FBI raid in October on the Internet marketplace Silk Road website , known as an anonymous website for transactions involving illegal drugs, criminal activities and other underground goods, NBC News reported.
An announcement of the auction was made by the U.S. Marshal Service on Thursday.
"The bitcoin up for auction were contained in wallet files on the Silk Road servers and do not include the bitcoins contained on the computer hardware belonging to Silk Road owner Ross William Ulbricht, known online as 'Dread Pirate Roberts,'" NBC News reported.
"The virtual currency is transacted independent of central control and is not backed by any government or central bank."
In October, Ulbricht was arrested and charged by the FBI with one count each of narcotics trafficking conspiracy, computer hacking conspiracy and money laundering conspiracy.
Bitcoin are an unregulated online currency that is not backed by gold, silver or any other commodity, USA Today reported.
Since bitcoin are virtual, they are being auctioned off in sets of numbers that have been entered in an online public ledger.
Taking place over a 12-hour period, the bitcoin are to be auctioned off in nine blocks of 3,000, each worth about $1.8 million.
The winning bidders would be notified by June 30, the U.S. Marshals Service said.
About 144,342 additional seized bitcoins were transferred from the FBI e-wallet to the U.S. Marshals Service e-wallet, Kelly Langsmesser, FBI spokeswoman, confirmed.
The seized bitcoins are part of the civil forfeiture and criminal action brought against Ulbricht and the assets of Silk Road, the U.S. Marshals Service said in a statement. These coins have not been put up for auction, according to NBC News.
The Silk Road website had nearly 1 million customers and $1.2 billion in sales, according to court papers in the case. Commissions worth $80 million were allegedly collected by Ulbricht.
