On Tuesday, the Finnish government released a new “Guidelines” that should, among others, regulate the law enforcement officials measures with the cryptocurrencies that they confiscated and, as it is said, they will be holding an auction.
Roughly, there is around 2.000 Bitcoins that authorities in the country have confiscated. The 2.000 coins were worth just south of $40 million during the peak of the Bitcoin boom in December of 2017, and are now valued, as said by Bloomberg, at approximately $22 million. An auction will show the last worth.
The guidelines say that the authorities handling the coins won’t be allowed to store them on virtual currency exchanges. Instead, they’ll be required to keep them off the Internet.
Also, the authorities can’t treat Bitcoin or its crypto competitors like a currency. It’s an asset that, as a rule, can’t be used or accepted as a means of payment or as an investment, according to the Treasury document.
Cryptocurrencies seized by the Finnish state can be converted into euros after a court ruling on their appropriation has become binding. The sales should primarily take place via public auctions rather than commercial exchanges, which can be untrustworthy and opaque, the Treasury said.
BTC in government control must be kept in ‘cold storage’ in which they would maintain a wallet that does not have an active Web connection. Bloomberg said the Helsinki customs office would not indicate how it has been storing the cryptocurrencies until now.
Just for reminder, 2016, customs agents in Finland seized bitcoin and other items worth about €1 million at the time, in connection with the operation of an online dark market called Valhalla. Last year, Finland’s financial regulation body has issued a warning about the dangers of investing in cryptocurrencies like Bitcoin. They then said that cryptocurrency Bitcoin was being used by speculative investors and that is very risky.
The European Banking Authority made similar warnings back in 2014. The EBA warned consumers of the potential risk of theft of cryptocurrencies from digital wallets, that no consumer protection agency would be helpful in settling disputes or recouping losses and that the value of the currencies can vary or even drop down to being worthless.
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