Bitcoin Investor’s $124M Crypto Keys Seized in Tax Fraud Case

• A man who has been investing in Bitcoin since 2011 has falsified tax reports on $3.7 million worth of BTC sales.
• He has been ordered to reveal private keys and devices containing a stash of “at least” 1,287 BTC worth over $120 million.
• The BTC investor will serve 2 years in jail and pay over $1 million in restitution.

A Texan Bitcoin (BTC) investor who has been staking Satoshi’s since 2011 has been ordered to give up the private keys to his $124 million crypto stash in a landmark ruling following a tax evasion case.

Private Keys

As per Bloomberg , court documents have revealed that Texas BTC investor Frank Richard Ahlgren III has been ordered to hand over the private keys to his crypto wallets, disclose all access codes, and identify all devices concealing his crypto, which is believed to be a stash now worth $124 million.

Ahlgren was initially sentenced in December 2024 for falsely underreporting the capital gains earned after selling $3.7 million in BTC and now owes the government over $1 million in restitution.

The order also prohibits Ahlgren from transferring, selling, or shifting any property and crypto without prior court approval.

Ahlgren has also been ordered to serve a year of supervised release after his 24-month prison stint.

Underreporting Gains

As per a Dec. 12, 2024 press release from the U.S. Office of Public Affairs upon his sentencing, Ahlgren had been buying up BTC since 2015, noting a 2015 purchase of 1,366 BTC via Coinbase . That year, BTC was trading as low as $200 and peaked just above $465.

In October 2017, he sold 640 BTC for a total of $3.7 million at roughly $5,807.53 per BTC.

He then used most of the profits from his 2015 investment to buy a new house in Park City, Utah. In 2017, he filed a false statement of his gains and losses by claiming he had purchased the BTC at a “much higher price.” The release writes:

“[…]indeed, his claimed purchase prices were greater than the highest price bitcoins sold for in the market prior to the purchase of the Utah house. Ahlgren then filed a false 2017 federal income tax return that substantially inflated the cost basis of the bitcoins, thereby underreporting his true capital gain from his sale of bitcoins.”

Further BTC sales totaling over $650,000 in 2018 and 2019 went completely unreported. Instead, Ahlgren took “several sophisticated steps” to hide his tracks by making in-person trades for cash, moving BTC through multiple wallets, and leveraging crypto mixers .