The Czech government survived a political storm this week and survived a no-confidence vote caused by a $45 million Bitcoin payment from convicted criminals.

The scandal shook Prime Minister Petr Fiara’s administration a few months before the general election, Reuters reported.

The 468 Bitcoin payment was made to the state by a man who was previously imprisoned for running a darknet drug market known as the Sheep Marketplace.

The donation was accepted by then Minister of Justice Pavel Blazek. Pavel Blazek later resigned in repulsion on behalf of the government. Bitcoin is sold for around 1 billion Czech Koruna and is worth around $45 million.

The opposition party who leads the poll ahead of the October vote filed a motion for no confidence, denounced the control coalition for potentially helping to wash illegal assets due to unknown sources of BTC.

Critics say the government should have involved prosecutors or police instead of accepting potentially contaminated crypto funds. After two days of discussion, Motion failed in the House. There, the Fiala Union holds a majority.

Still, Blazek argued that he acted legally in accepting donations.

The donor’s motives remain unknown. The incident shook the government of the country earlier this year that approved a proposal by the central bank to study Bitcoin as a reserve asset. Chief of the Czech National Bank, Yale Mischur, even said that Bitcoin is even “collected” with the cryptocurrency.

Poly market traders are now seeing the main opposition party of October, ANO, win parliamentary elections. The recognized odds of the results are currently 92%, but Blazek’s ODS party chances are just 6%.

Ross Ulbricht, the imprisoned founder of the Silk Road darknet marketplace who was granted clemency by US President Donald Trump earlier this year, received a whopping $31 million Bitcoin donation from an anonymous wallet over the previous weekend.

The sizable gift, sent less than five months after Ulbricht’s sentence was commuted, immediately sparked speculation that he had covertly reclaimed old Silk Road earnings.

Anonymous Bitcoin Gift to Ross Ulbricht

According to the intel shared by cryptocurrency tracing firm Chainalysis with WIRED, the 300 BTC donation did not originate from Silk Road at all. Instead, the funds appear to trace back to AlphaBay, a now-defunct darknet market that operated between 2014 and 2017, well after Silk Road’s takedown.

AlphaBay, which was reportedly ten times the size of Silk Road at its peak, was known for trafficking in drugs, malware, and illegal services. Phil Larratt, Chainalysis’s director of investigations and a former UK law enforcement official, said there are “reasonable grounds to suspect” the Bitcoin came from someone involved with AlphaBay – likely a former vendor, given the size of the amount.

Prominent blockchain investigator ZachXBT, who had earlier examined the donation, also concluded the funds did not come from Silk Road.

Despite the sender’s use of Bitcoin mixing services, ZachXBT traced the BTC to a wallet previously flagged by Chainalysis as connected to illicit activity. He shared his conclusion with WIRED, wherein he noted that the donation itself may be genuine, but “not legitimate funds.”

Additional clues suggest the person behind the transfer may have been actively trying to avoid detection: ZachXBT discovered the same individual had previously cashed out other crypto through centralized exchanges in small, spread-out amounts, rather than large single transactions. This behavior is consistent with an effort to evade asset freezing or scrutiny.

AlphaBay Crackdown

Chainalysis reportedly declined to share specifics on how exactly it linked the donation to AlphaBay.  But it is important to note that the firm is widely known for its expertise in mapping illicit activity across blockchain networks and played a crucial role in dismantling the now-defunct marketplace during the multinational law enforcement initiative 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 prison. As for Ulbricht, he has not publicly addressed the donation.

The founder of the darknet marketplace Silk Road, Ross Ulbricht, received 300 BTC, worth around $31.4 million, in a single donation from an unknown wallet, data from Arkham Intelligence shows. 

Ulbricht, who was sentenced to life in prison, received a full and unconditional pardon from U.S. President Donald Trump on January 21. He was released following the pardon after serving 12 years in prison.

Blockchain data further indicates that Ulbricht transferred the received funds on June 1, sending $31.29 million to one address and $10,000.43 to another. 

The latest donation amount far exceeds those Ulbricht received after his release. A wallet operated by the Free Ross campaign bagged $270,000 worth of Bitcoin within days after he was freed. The funds were donated to “help Ross’s transition into his new life.”

Ulbricht’s personal items have fetched $1.8 million in an auction so far

The above transactions took place after Ulbricht had already secured $1.8 million from his ongoing auction of personal items. The auction, which is live till June 2, is being conducted on the Bitcoin-only marketplace Scarce City. 

In a note on Scarce City, Ulbricht wrote: 

“I’ve decided to auction some personal items from before my arrest and during my time in prison. I don’t need the reminders, and I’m sure some of you will love to have them.”

The personal items up for auction include a sleeping bag and backpack from before his arrest, prison ID cards, and paintings he created during his incarceration. 

Ulbricht’s most recent prison ID card was sold for 5.5 BTC, worth over $580,000, after the winning bid of 11 BTC (worth approximately $1.1 million) was not paid. 

According to the item’s description, Ulbricht had to have his ID reissued with a recent photo in 2024 after a prison guard threatened to suspend his visitation rights. Talking about the ID photo, which depicts Ulbricht smiling, he noted: 

“The guard tried to get me to stop smiling for the photo, but my joy comes from within, so I smiled that day, even though I was in prison :)”

A December 2023 oil painting entitled ‘Archway,’ which Ulbricht created in collaboration with a fellow inmate who goes by Omega, was sold for 1.01 BTC, worth over $106,000. The item’s description noted that Omega had taught Ulbricht oil painting techniques. He wrote:

“I loved the look of this archway in a photograph so much, I had to paint it. It gave me the feeling that, if I could pass through it, something better would be on the other side.”

Ulbricht can access millions of dollars worth of dormant BTC

In addition to the large sums Ulbricht has racked up in donations, he might also have access to millions of dollars worth of BTC that were never seized by the U.S. government. During the 2013 Silk Road bust, the government had seized over 100,000 BTC.

On Jan. 22, Coinbase director Conor Grogan found 430 BTC, worth around $47 million, across multiple wallets linked to Ulbricht. These wallets were lying dormant for over 13 years, Grogan noted. 

Grogan’s discovery was confirmed by Arkham Intelligence, which traced 14 Bitcoin wallets linked to Silk Road, one of which contains BTC worth $9 million.

Earlier last month, two of these dormant wallets became active, transferring 3,422 BTC worth $324.2 million.

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