DHAKA: A collection of bitcoins worth about £8m, which had been confiscated by police in Australia, will be auctioned off in June.

The 24,518 bitcoins will be sold mostly in blocks of 2,000 - each with a market value of about £680,000.

Ernst & Young, the firm organizing the auction, said the bitcoins had been ‘confiscated as proceeds of crime’ but did not elaborate on the case.

One expert said the authorities had chosen a ‘safe’ time to sell.

Australian newspapers have previously reported that 24,500 bitcoins were seized by police in the state of Victoria in 2013, after a man was arrested for dealing illegal drugs online.

In 2015, Victoria’s Asset Confiscation Operations department ‘confirmed it had recently taken possession of 24,500 coins and would try to make the most of it’, according to the Sydney Morning Herald.

‘This is a significant amount of Bitcoin,’ Dr Garrick Hileman, economic historian at the Cambridge Centre for Alternative Finance, told the BBC. ‘It’s about a week’s worth of new Bitcoin that comes onto the market through mining’.

Currently about 4,000 new bitcoins are generated a day, as a reward for ‘miners’ who offer their computer power to process Bitcoin transactions.

The seized coins are auctioned in blocks because quickly selling a large number of coins for cash at a Bitcoin exchange could negatively affect the market.

‘Generally the view is that any time 10,000 bitcoins sell, the market price can be moved significantly,’ said Dr Hileman.

The price of Bitcoin rose to $530 on Friday, its highest level since August 2014.

BDST: 1419 HRS, MAY 31, 2016
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