June 12 (Reuters) - The U.S. government plans to auction about 30,000 bitcoin, the electronic currency, valued at about $17.4 million, on June 27 the U.S. Marshals Service said.
The bitcoin were seized during an FBI raid in October on the Internet marketplace Silk Road, known as a hub for transactions involving illegal drugs and criminal activities.
The bitcoin up for auction were contained in wallet files on the Silk Road servers and do not include the bitcoins contained on the computer hardware belonging to Silk Road owner Ross William Ulbricht, known online as "Dread Pirate Roberts."
The virtual currency is transacted independent of central control and is not backed by any government or central bank.
The FBI arrested Ulbricht in October and charged him with one count each of narcotics trafficking conspiracy, computer hacking conspiracy and money laundering conspiracy.
The auction will take place on June 27 on the U.S. Marshals Service website over a 12-hour period and consists of nine blocks of 3,000 bitcoins and one block of 2,657 bitcoins. (http://r.reuters.com/tuv99v)
The U.S. Marshals Service said it would notify the winning bidders by June 30.
FBI spokeswoman Kelly Langsmesser confirmed that about 144,342 additional seized bitcoins were transferred from the FBI e-wallet to the U.S. Marshals Service e-wallet.
The seized bitcoins are part of the civil forfeiture and criminal action brought against Ulbricht and the assets of Silk Road, the U.S. Marshals Service said in a statement. These coins have not been put up for auction.
Bitcoin prices fell about 6.74 percent to $585.56 today, on the news, according to the digital currency exchange Coindesk.com. (Reporting by Ankit Ajmera and Tanvi Mehta in Bangalore; Editing by Cynthia Osterman)