Australian Police Seize $4.1M in Bitcoin Linked to Darknet Market

New South Wales police executed a search warrant at a home in Ingleburn on May 4 and seized 52.3 Bitcoin, valued at about A$5.7 million (US$4.1 million), along with electronic devices. The action followed a 15-month investigation by Strike Force Andalusia, a unit within the State Crime Command’s Cyber Crime Squad.

Officers arrested two men, aged 41 and 39, who are accused of having access to the cryptocurrency wallet. The 41-year-old is due to appear at Campbelltown Local Court on May 13 and the 39-year-old is scheduled to appear at Batemans Bay Local Court on June 15.

Detective Superintendent Matt Craft described the seizure as one of the largest darknet-related cryptocurrency recoveries in Australia and said it highlights that criminal activity on the darknet is not anonymous. He added that darknet marketplaces enable serious criminal activity.

Investigators have not publicly confirmed how control of the funds was recovered, including whether seed phrases or other cryptographic keys were obtained. Authorities said the devices seized during the raid will be forensically examined as part of the ongoing inquiry. NSW Police were contacted for additional clarification and did not immediately provide a response.

The seizure coincides with stepped-up oversight of the digital asset sector by the Australian Transaction Reports and Analysis Centre, or AUSTRAC. The agency launched two campaigns targeting virtual asset service providers that offer over-the-counter crypto-to-cash services and local exchanges. AUSTRAC has engaged with 36 crypto businesses and 27 local exchanges to assess and improve anti-money-laundering controls. AUSTRAC CEO Brendan Thomas noted the reviews are occurring ahead of major new laws coming into force.

Legislative reform is already scheduled: the Corporations Amendment (Digital Assets Framework) Act 2026 received Royal Assent on April 8 and will bring digital asset platforms and tokenized custody services into the financial services licensing regime from April 9, 2027.

Law enforcement in Australia has previously recovered large sums of cryptocurrency linked to darknet operations; Victoria Police recovered about A$6.2 million in crypto assets in August 2021. Prosecutors will determine charges based on evidence from the seized devices and financial traces tied to the wallet, as investigations continue.