Texas Court Orders Bitcoin Investor to Surrender Keys to $124M Stash  

• A Texas court mandates Frank Ahlgren to relinquish private keys for $124M in Bitcoin and restricts digital asset transfers. 
• The order aims to recover $1 million in damages, while Ahlgren may use crypto to finance living expenses. 
• Ahlgren’s sentencing marks the first U.S. crypto tax evasion case, resulting in a two-year prison term. 

A U.S. District Court in Texas has ruled that Frank Richard Ahlgren III, an early cryptocurrency investor, must surrender private keys to his $124 million Bitcoin wallet. This decision, issued by Judge Robert Pitman, follows a landmark conviction for tax evasion in December. 

Restrictions on Asset Transfers 

In addition to handing over private keys, Ahlgren is prohibited from moving or concealing any digital assets. The court’s ruling also covers any other devices used for storing cryptocurrencies. However, the court has allowed him limited access to crypto funds to cover monthly living expenses. According to Bloomberg 

The court’s order seeks to unlock Ahlgren’s extensive Bitcoin holdings, aiming to recover $1 million in damages approved during his trial. This move highlights the judiciary’s focus on enforcing financial accountability among cryptocurrency investors. 

Ahlgren’s case gained national attention as the first U.S. crypto tax evasion conviction. Federal prosecutors accused him of underreporting capital gains from a $3.7 million Bitcoin sale and using advanced financial methods to hide assets. 

Sophisticated Tactics to Evade Taxes 

Prosecutors revealed that Ahlgren, who used the alias “Paco,” leveraged blockchain obfuscation techniques to obscure his transactions. Despite Bitcoin’s public and immutable ledger, he attempted to exploit protocols designed to anonymize financial activities. 

After a prolonged investigation and trial, Ahlgren was sentenced to two years in prison. His actions set a precedent for future crypto-related tax evasion cases, demonstrating the government’s capacity to trace digital transactions and enforce compliance. 

Implications for the Crypto Community 

This ruling underscores the growing scrutiny of cryptocurrency transactions by regulatory bodies. Besides ensuring tax compliance, the case signals a stricter approach toward safeguarding public financial systems from evasion tactics.