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U.S. launches sale of $17.2 million of bitcoin seized in raid

June 27, 2014, 12:04 PM UTC

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The federal government is accepting bids Friday for nearly $17.2 million worth of bitcoin booty.

The auction, which takes place over 12 hours starting at 6 a.m. ET, is the first time the U.S. has sold off a virtual asset. Bidders will submit an online sealed bid and will find out Monday by 5 p.m. ET if they won a portion of the bitcoin.

The digital currency was seized by the Federal Bureau of Investigation and the U.S. Marshall Service when it raided Silk Road, an online seller of contraband.

While the U.S. is used to selling off items seized from criminal raids — such as cars, jewelry and boats — federal authorities are less versed in how to divest property that exists solely online.

The process has had its bumps. Authorities ended up releasing a list of potential bidders accidentally on June 18 after saying they would not release any details about the participants or the winning bids.

Only about 20% of the bitcoin seized from Silk Road will be sold off in the first round. This auction is essentially a test run for the government on how to handle future auctions of bitcoin, or other digital-only assets.