Bitcoin promoter Charlie Shrem
Bitcoin promoter Charlie Shrem walks out of federal court in Lower Manhattan, New York Reuters

Bitcoin pioneer Charlie Shrem has been sentenced to two years in prison for assisting notorious online black market Silk Road.

Shrem, who was CEO at bitcoin firm BitInstant and a former member at Bitcoin Foundation, earlier pleaded guilty to aiding Silk Road by selling $1m (£639,000, €815,000) worth of the digital currency.

Shrem will also serve three years of supervised release in addition to the prison sentence.

"I screwed up really badly," Shrem told Manhattan Federal Court Judge Jed Rakoff.

"I have no excuses for what I did. I broke the law and I broke it badly"

He said he knew that the transactions were going to be used to bolster the website known for selling illegal drugs, weapons and contract killings.

"Bitcoin is my baby. It's my whole life. It's what I was put on this Earth to do," he added, speaking about the digital currency.

"There's no question that Mr Shrem, over a period of many months, was knowingly, willfully, to some extent excitedly and even passionately involved in activities he knew were, in part, involved in serious violations of the law," the judge ruled.

Shrem also was ordered to forfeit just under $1m.

Shrem earlier admitted the charges at a New York federal court hearing, while another bitcoin trader Robert Faiella, who purchased large quantities of bitcoins from BitInstant for Silk Road users, also pleaded guilty.

Shrem was arrested at JFK airport on 26 January, and he and Faiella were charged with selling more than $1m worth of bitcoins to users of Silk Road. Bitcoin was the only form of payment on the website.