The $730 Million Bitcoin Wallet Nobody Wants to Touch
This Bitcoin address with almost 80,000 BTC from the first Mt.Gox hack has been untouched for over 9 years. Will anyone ever move the funds?
The sixth-largest Bitcoin address contains nearly 80,000 BTC, which is said to come from the famous Mt.Gox hack in 2011. The money has not been moved since the theft and, according to experts, can be regarded as "high-risk" so that it is difficult to pay it out. However, it is not impossible to move the money and not be discovered. So will these funds ever be moved?
A recent Reddit thread has sparked interest in the case again. According to the Reddit user "jwinterm", a Bitcoin address that is related to the Mt Gox hack has been unearthed. Per data from Bitinfocharts.com, this Bitcoin address has a balance of 79,957.20 BTC. Not a single satoshi has ever been moved out. At the time of writing, that's just over $730 million - a substantial amount. So why the lack of movement?
The blockchain analytics company Chainalysis gives one possible reason for this:
"We have had this address labeled in our products as stolen funds for a long time. If the funds are sent to an exchange they would be considered 'high-risk,' making it more difficult for them to successfully cash out," said director of communications for Chainaylsis, Maddie Kennedy.
There are two options: Perhaps the hacker has lost the private keys or he simply cannot move the funds without being tracked down. Both hypotheses hold some weight. But assuming the hackers have access, how difficult would it be to theoretically move the funds? According to Chainalysis, paying out while the address is in your sights is a fairly risky but not impossible step.
"It is more difficult to move these funds knowing that the industry has eyes on it," explained Kennedy, "that said, we saw PlusToken scammers move very large amounts like this. While they were easy enough to track, they were able to cash out large amounts of funds via multiple over-the-counter (OTC) brokers in Asia. Hopefully awareness about these OTC brokers will make it more difficult for them to cash out illicit funds undetected."
Still, there are a number of tactics that owners of this BTC address could use to disguise their transaction. Some examples would be the transfer of BTC through coin mixers, the use of payment channels such as Lightning Network or the exchange in privacy coins via unregulated exchanges and OTC markets. Once veiled funds are sent to an exchange, it becomes very difficult to track activity within or from that location.
It could be a case of waiting for the right conditions for liquidating such a large amount of BTC or taking time to plan a low-risk approach to laundering the funds.