Oh, they'll use it to fund something illicit. Or blow it. It's only worth 3.6E6 FRNs.
Problem is, bitcoins are auditable.
Without knowing a "who" to attach to the coins, it's just watching it go from anonymous wallet to anonymous wallet.
But, when you know a "who" to attach to the wallet ID, you can audit every coin that touches that wallet.
All 25,000BC here will get marked. Someone will write an app soon to allow BC users to be on the lookout for suspect BitCoins that have ever been touched by a FedGov controller. Making a transaction, and the BC you are being paid with are part of the SR sting? Cancel the transaction and blackball the guy you're working with.
I even saw one post (on reddit, I think) talking about the possibility of re-authoring the blockchain and wallet software to deny the validity of the 25,000BC the government now has. It got shot down for being hypocritical... but it was proposed.
Also interesting, we don't know if the government actually has control over the 25,000BC in question. They have denied Ulbricht access to it, sure. But the BC aren't on his computer... they're in the block chain. And if the block chain doesn't allow FedGuv to have them, then FedGuv can't have them. To operate those BC, FedGov needs the ability to open Ulbricht's wallet. This is one of those 4A/lead-pipe-cryptoanalysis conundrums we often talk about here.
Ulbricht still owns those BC. And there's NOTHING FedGov can do to take them away.
In fact, if Ulbricht has a wallet backup and trusts someone well enough, he can tell his lawyer his password and his lawyer can siphon those BC elsewhere, through a TOR protected wallet client, and
FedGuv will never know.