Czech Justice Minister Resigns After Bitcoin Selling Scandal

Czech Justice Minister Pavel Blažek has announced his resignation after it became known that the first cryptocurrency worth about $45 million, which had previously been confiscated from Tomas Jirikovsky, a man convicted of organizing illegal trade on the darknet, had been sold, local media reported.

A few days ago, it became known that the agency sold 500 BTC at auction for 1 billion Czech crowns (about $45 million). The funds were planned to be used for the digitalization of the judicial system, the fight against drug crime in prisons and improving the living conditions of the staff of institutions. However, later the media revealed that these crypto assets belonged to Tomas Jirikovsky, who was previously sentenced to prison for creating and managing the darknet platform Sheep Marketplace, where prohibited substances and other illegal goods were sold.

After his release in 2021, Jirikovský said he wanted to compensate for the damage by offering some of his bitcoins to the state. His lawyer contacted Blažek, who was already heading the ministry at the time, and offered 1/3 of the bitcoins as a charitable contribution to the department. Blažek agreed without checking the origin of the funds. Amid growing criticism from the opposition and the approaching legislative elections, Prime Minister Petr Fiala chose to distance himself from the scandalous incident.

As a result, on May 30, Pavel Blazek resigned, citing a desire not to harm the government's reputation. Blazek himself stated that he did not know the real sources of the cryptocurrency and had no opportunity to investigate the details of its origin, since the criminal case was closed many years ago. According to him, he viewed the donation as an expression of remorse on the part of a former prisoner.

To recap, in 2017, Tomáš Jirikovský was found guilty of fraud, drug trafficking, and illegal arms trafficking. After his release, he tried to get back 1,500 bitcoins that law enforcement had seized from him. Czech authorities also suspected that some of these assets were linked to another darknet platform, Nucleus Market, which was shut down shortly after his arrest. However, Jirikovský himself claimed that a significant portion of the cryptocurrency was obtained legally and remained with him after serving his sentence.