Hacker News Board Hacker News, browsed like a classic message board
Live data from Hacker News

U.S. Feds Seized Nearly $1B in Bitcoin from Wallet Linked to Silk Road

vice.com

Post reply on HN
Print view View original

91–100 of 369 posts

Re: U.S. Feds Seized Nearly $1B in Bitcoin from Wallet Linked to Silk Road

#91

Post by ineedasername »

seibelj wrote: post #43
londons_explore wrote: post #39

This gives the US government a lot of power over bitcoin... That both gives the government an incentive to let bitcoin thrive (to protect it's holdings), but also an opportunity to substantially manipulate bitcoins market price, possibly down to nearly zero. Or the keys to these bitcoin will sit idly in a filing cabinet forever...

Despite loads of blockchain haters on HN, the government recognizes that bitcoin has value and has formal processes to seize, custody, and auction off the assets to add money to the federal treasury.

This is not an endorsement of the value of bitcoin, any more than it would be an endorsement of the value of beanie babies if such a collection was part of the assets seized.

All this means is the government is aware that bitcoins can be traded for real dollars. Its job when seizing assets is to simply perform that transaction.

Re: U.S. Feds Seized Nearly $1B in Bitcoin from Wallet Linked to Silk Road

#92

Post by curiousllama »

jonas21 wrote: post #60
gruez wrote: post #55

Earlier quoted context omitted.

The point of bitcoin is that you can drive across the country "carrying" $1B worth of assets, and if you get pulled over by the cops it won't be found. Try doing that with gold bars or stacks of cash.

I am glad we finally have a solution to this pressing issue.

I know it sounds silly but it’s legit. Tons of stories of people driving out to buy a car, getting pulled over, having $10k seized without being charged with a crime, and then having to sue to get it back under a presumption of guilt.

Bitcoin is harder to seize under civil asset forfeiture.

ETA: in the US. Not sure about other countries.

Re: U.S. Feds Seized Nearly $1B in Bitcoin from Wallet Linked to Silk Road

#93

Post by SOLAR_FIELDS »

macspoofing wrote: post #35
TheHypnotist wrote: post #29

I'm not the most saavy BTC person, but isn't part of the allure of bitcoin the ability to evade this type of seizure?

>but isn't part of the allure of bitcoin the ability to evade this type of seizure The government didn't crack the wallet address. They 'compelled' the owner to give it to them. Bitcoin was not designed to evade that type of seizure.

As always, the extremely relevant XKCD: https://xkcd.com/538/

Re: U.S. Feds Seized Nearly $1B in Bitcoin from Wallet Linked to Silk Road

#95

Post by ilikecode »

TedDoesntTalk wrote: post #51
okareaman wrote: post #34

Earlier quoted context omitted.

The Feds seized it from "Individual X" who hacked the account, they didn't hack and seize the account directly

You're assuming there actually is an Individual X. It is possible he was fabricated in order to hide that the Feds indeed did gain the password for the wallet.

Maybe it took 8 years to crack the password?

Re: U.S. Feds Seized Nearly $1B in Bitcoin from Wallet Linked to Silk Road

#96

Post by lastofthemojito »

Forbo wrote: post #52
dirtnugget wrote: post #47

So what happens to bitcoins which were seized by the US government?

They typically get auctioned off, much like other property seized in asset forfeiture proceedings.

That's an interesting angle in the "is Bitcoin really a currency or is it just property?" argument. What would happen if the US government seized a billion dollars worth of foreign cash?

Would that get auctioned off too? Seems like a weird auction, selling money.

Re: U.S. Feds Seized Nearly $1B in Bitcoin from Wallet Linked to Silk Road

#97

Post by RIMR »

aqme28 wrote: post #89

Very curious how they convinced this anonymous hacker to give up $1B to the federal government. The filing makes it sound like it was voluntary, but I doubt it really was.

What do you even do with that much bitcoin realistically? It's dirty, so any attempt to turn it into fiat puts you at risk of being found. Whoever had it refused to touch it for 7 years, likely because they knew it was a fast-track to getting arrested.

Giving that money straight to the feds in exchange for immunity might be more attractive than trying to hide the reason you became a billionaire.

Re: U.S. Feds Seized Nearly $1B in Bitcoin from Wallet Linked to Silk Road

#98

Post by canada_dry »

TL;DR: The wallet held the proceeds of "Silk Road" drug trafficking, a hacker stole the wallet. Feds tracked down the hacker and just made a deal with him to give them keys to the $1B wallet.

Hacker prob got a nice pen and stayed out of Federal prison.

Re: U.S. Feds Seized Nearly $1B in Bitcoin from Wallet Linked to Silk Road

#99

Post by duxup »

seibelj wrote: post #70
duxup wrote: post #66

Earlier quoted context omitted.

Is that a valuable use case? Just another instrument to try to use as a hedge? That really doesn't seem like what Bitcoin or the community is all about.

You can't win arguing about crypto on HN. I list 50 use-cases, everyone says a centralized DB can do it better. I say the most crucial one - inflation hedge - and you say "What, that's it?" You can lead a horse to water, but you can't make it drink.

I didn't look through 50 use cases, but as far as the potential as a hedge ... that seems really ephemeral and like so many things, is a thing that is already a thing.

Re: U.S. Feds Seized Nearly $1B in Bitcoin from Wallet Linked to Silk Road

#100

Post by LiquidSky »

vmception wrote: post #40
TheHypnotist wrote: post #29

I'm not the most saavy BTC person, but isn't part of the allure of bitcoin the ability to evade this type of seizure?

Yes and it took the US Gov 8 years to come up with a way to do so with mutual cooperation after knowing the identity of the owner and having a way to communicate with that owner. Very different than any random judge or municipal police freezing anything they want. Have a stash that people dont know about, no series of shell corporations and foundations required.

>mutual cooperation

This is some quality spin, so kudos for that.

You make it sound like the government and the individual in question came to a friendly agreement, when what happened was the government discovered the person's identity and used the powers available to them to get a consent to forfeiture out of them.

>Very different than any random judge or municipal police freezing anything they want.

Not at all. Just as the authorities have to know an identity to freeze an account in a criminal matter, if they know your identity then they can compel you to give up your Bitcoin stash. You can refuse, but then you'll go to jail. It's no different than some drug lord burying their money in the desert somewhere and refusing to give it up to the feds when they come.

People keep pretending Bitcoin/cryptocurrency is magic and immune to real world pressures, and keep getting rude awakenings when they learn it's not.

Post reply on HN