Norwegian prosecutors have demanded that three men charged with selling drugs on dark web marketplaces must repay some of their ill-gotten gains in bitcoins.
In what is thought to be the first attempt to confiscate the proceeds of crime in a virtual currency in Europe, prosecutors will argue the online dealers should hand over 120 bitcoins (€140,821), along with 3.1 million Norwegian krone in cash (€338,692).
The three men were arrested in June 2015 on suspicion of selling drugs on hidden websites such as the original Silk Road marketplace, which was closed down by the FBI in 2013.
During raids in Oslo that led to the men’s detention, police seized a considerable amount of drugs and computer equipment, and discovered an illegal indoor cannabis factory. Officers also claim to have found proof the men had been accepting payment from clients in bitcoins.
The men were formally charged with a number of drug offences on Friday after what public prosecutor Richard Beck Pedersen described as a “challenging” two-year police investigation into their activities.
Pedersen said the trio had built up a significant dark web drug dealing mail order operation that was uncovered by Norwegian investigators and international law enforcement agencies.
The men’s trial is expected to be scheduled for later this year.
Speaking with the Associated Press, Pedersen stressed that any seizure of bitcoins that resulted from the case should not be seen as a tacit acknowledgement of the legitimacy of the virtual currency.
News of the Norwegian prosecutors’ demands comes after Danish police last month revealed they had developed a technique to track dark web vendors accepting bitcoin payments.
Kim Aarenstrup, head of the National Cyber Crime Centre (NC3) of the Danish National Police, told Danish daily Berlingske that his officers had discovered how to use blockchain analysis to track down dark net market users.
“We are pretty much unique in the world at this point, because no one else has managed to use these tracks as evidence,” Aarenstrup said.
“Everyone is looking toward Denmark in this field, and we are in close dialogue with a number of other countries right now so we can further develop methods and teach them how we do it here…
“I would just say to those out there in the criminal community that they need to be careful because we can follow them. They should not think they can hide from the police anymore.”
While the legal status of bitcoin varies from country to country, European nations have broadly embraced the virtual currency, despite its links with organised crime and the dark web.
