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Earlier this week, the Lithuanian tax service, the Lithuanian State Tax Inspectorate, added $ 7.6 million to the state budget through the sale of cryptocurrencies seized during criminal investigations.
The occasion marked the first time that the Lithuanian government has liquidated the confiscated cryptocurrencies. In doing so, the country has joined the growing number of jurisdictions around the world that have auctioned or sold cryptocurrencies obtained from the long arm of the law.
However, unlike the US Federal Marshals, who earned $ 37 million at auction from confiscated cryptocurrencies last February, the STI decided to sell the cryptocurrency through an exchange. According to Linas Rajackas, CEO of the Vilnius-based crypto startup Kaiserex, this seemed to work in the regulator’s favor:
“We managed to sell Bitcoin above the average price of that day, no auction would have reached it. STI spent less than 0.2% of the total amount received (6.4 million euros) on exchange fees, legal contracts and cryptographic transaction services. So it was as efficient as possible. “
STI has chosen Kaiserex as a technology partner for the sale of the cryptocurrency through a public tender. STI manager Edita Janušienė told Cointelegraph:
“The goal of the STI was to convert cryptocurrency into euros as soon as possible. Therefore, first of all, the decision was made to announce a public tender in search of a national supplier. Four Lithuanian companies took part in the competition, which Kaiserex won. “
According to Janušienė, the sale of cryptocurrencies began on November 18 and took nearly 24 hours to complete, with the STI eventually adding over € 6.4 million to the state budget. The rypto was initially confiscated by a local court. Although Janušienė confirmed the Kaiserex partnership, he did not explain why the regulator moved away from the auction model.
Rajackas speculated that “[the STI] they consulted with industry professionals and it was obvious that selling to large OTC banks would be much more profitable than doing it in an auction. Auction in comparison is a bad choice, because you can’t know in advance a good day to sell, set the price or back down. “
Kaiserex completed the sale via an over-the-counter counter at a major cryptocurrency exchange. Rajackas said: “I can’t tell the OTC counter we used, what I can say is that it is in the top five cryptocurrency exchanges in the world.” At the time of publication, the top five cryptocurrency exchanges on CoinMarketCap are Binance, Huobi Global, Coinbase Pro, Kraken, and Bithumb.
The sale involved approximately 337 Bitcoin (BTC), 360 Ether (ETH) and nearly 12,000 Monero (XMR). Each cryptocurrency was sold at a market price on the day of the trade, with a BTC priced at 15,100 euros ($ 17,900), an ETH at 400 euros ($ 480) and an XMR at 99.6 euros ($ 119).
The bull market, in which Bitcoin briefly crossed the $ 19,000 mark, was one of the reasons the sale was so profitable, according to Rajackas. “This made it possible to sell the available cryptocurrency at record prices and extract the maximum amount of euros,” Rajackas said, adding:
“My opinion would be that if a government wants to have cryptocurrency exposure it should be done by our ministry of finance, which plans and takes care of government resources. STI deals with taxes and realizing confiscated assets, they have no business in speculating or they hold something as an investment. “
Kaiserex is a cryptocurrency exchange that acts as a broker connected to more than 40 cryptocurrency exchanges and multiple OTC banks. Rajackas, who owns 100% of the company’s shares, says Kaiserex isn’t listed on major cryptocurrency websites like CMC because they don’t have internal orders and rely on other exchanges for liquidity.
The company reportedly plans to continue working with Lithuanian institutions on similar cryptocurrency deals and support the Lithuanian central bank in its digital currency efforts.
