Matthew Ferry's List: Bitcoin

The criminal charges unsealed on Monday by the United States attorney’s office in Manhattan claim that Mr. Shrem used his company to knowingly convert money into virtual currency for people interested in buying narcotics on the Silk Road site. He was also accused of personally buying drugs on the site. According to the complaint, the scheme was operated in cooperation with another man, Robert Faiella, known as BTCKing, who was arrested on Monday in Florida.

 

When a co-founder of BitInstant asked Mr. Shrem why he was working with someone with such clear affiliation with Silk Road, Mr. Shrem wrote in an email in 2012 that, “he has not broken a law and Silk Road itself is not illegal,” according to the complaint. Mr. Shrem added, “We make good profit from him.”