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

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

#121

Post by superhuzza »

gamblor956 wrote: post #101
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.

Plenty of rich people drive or fly across the country all the time "carrying" $1b worth of assets. They're called bank accounts, and you can access them with these things called "check books" and "debit cards" that you can use in infinitely more places than you can transact Bitcoin or other crypto.

>They're called bank accounts, and you can access them

In lots of countries this is not guaranteed. Most recent example is Venezuela, central authorities imposed limited withdrawals.

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

#122

Post by dang »

wmf wrote: post #2

Discussion from yesterday: https://news.ycombinator.com/item?id=24990233 (This is not a dupe since the Bloomberg story has new information.) Has anyone found any official information from the DOJ about this?

The Bloomberg story is https://www.bloomberg.com/news/articles/2020-11-05/u-s-seeks....

(This comment was merged from https://news.ycombinator.com/item?id=24999794.)

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

#123

Post by ineedasername »

seibelj wrote: post #56
tyre wrote: post #54

Earlier quoted context omitted.

I simultaneously believe blockchain vastly underperfoms its promises and is a net waste of so much investment (human talent + time + capital) and also believe that bitcoin can be exchanged for real US dollars.

You honestly don't see one valuable use-case for bitcoin? And if serious mainstream investors start buying it as an inflation hedge, they are just idiots?

I think there are other mechanisms to accomplish most things that can (currently) be done with bitcoin. I think there's a good chance that will change at some point. Institutional investors are starting to take notice of crypto, but it doesn't appear to be a significant part of anyone's inflation hedge quite yet due to volatility and concerns of manipulation. Again, I think there's a good chance that will improve with time. But yes, for right now, I don't see an existing compelling use-case for crypto except in its future potential.

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

#124

Post by fallat »

GhostVII wrote: post #46
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?

It's pretty impossible to beat the $5 wrench attack (or in the case of the government, 5 years in prison) unless you have anonymity, which Bitcoin does a very bad job of.

Multisig or SSS.

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

#125

Post by gamblor956 »

colinmhayes wrote: post #50
cmauniada wrote: post #36

Earlier quoted context omitted.

Yes, but they didn't hack into the wallet. They basically found the person who was in-charge of the wallet and forced their hand (read: civil forfeiture) in order to gain access to the bitcoin.

I'm not sure civil forfeiture is the right term for what happened here. I don't think the government can compel individual x to give them the wallet's key. Unless they found the key laying around I'd say they likely they built a case against them and used that to get them to trade the billion dollars in exchange for dropping the case.

I don't think the government can compel individual x to give them the wallet's key.

In the U.S., they can compel someone to provide a password if doing so would not violate the owner's Constitutional rights (such as, for example, if it would be self-incriminatory). Courts in the U.S. have different thresholds at when that line is crossed, but a bright line rule is that providing a password is not self-incriminatory if the criminal case has already been litigated to its conclusion (i.e., the suspect has either been found or plead guilty, or was found not-guilty and double-jeopardy protections apply).

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

#126

Post by kjaftaedi »

lastofthemojito wrote: post #96
Forbo wrote: post #52

Earlier quoted context omitted.

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.

It's a security.

Securities are traded like currency because the security represents a proof of ownership.

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

#127

Post by klodolph »

gamblor956 wrote: post #90
bufferoverflow wrote: post #45

Earlier quoted context omitted.

With a bank they don't need your permission, they can just take your money straight from the bank. With cryptocurrencies they have to threaten you. And if you're ok with spending some time in jail (for court contempt), there's nothing they can do.

You can be held in contempt of court indefinitely.

Yes, exactly true. You can be held in contempt of court indefinitely, if it's possible for you to comply with the court order. There is no conventional "due process" because you are free to leave once you comply.

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

#128

Post by modeless »

ineedasername wrote: post #80
modeless wrote: post #42

Earlier quoted context omitted.

They will auction it off as soon as possible like they did several times before. I'm not sure why the bitcoin price has gone up in response to this news, because it means more supply is coming to the market soonish. These coins might have been presumed lost before. Certainly they would not have been able to be sold on any legitimate exchange. Now they will be washed clean and enter the markets. On the other hand, a b…

MtGox might be able to pay people the dollar value of their investment at the time, but still not the actual # of bitcoins.

True, but by essentially forcing creditors to hold their bitcoins instead of allowing them to sell, it's likely that MtGox has actually done most of their creditors a perverse favor, and they will end up with more money than if they had received their full bitcoin balance in 2014 and sold some of it since then. Assuming they are actually allowed to distribute the full value to creditors in the end, either as bitcoin or yen (the bankruptcy is in Japan).

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

#129

Post by anonAndOn »

gamblor956 wrote: post #90
bufferoverflow wrote: post #45

Earlier quoted context omitted.

With a bank they don't need your permission, they can just take your money straight from the bank. With cryptocurrencies they have to threaten you. And if you're ok with spending some time in jail (for court contempt), there's nothing they can do.

You can be held in contempt of court indefinitely.

That depends on your circumstances. There may be an 18 month limit in some situations.[0]

[0]https://arstechnica.com/tech-policy/2020/02/man-who-refused-...

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

#130

Post by themodelplumber »

aazaa wrote: post #69

I find it extremely amusing that the US government has over the last several years become one of the world's largest traders in bitcoin. It's not quite the path many were predicting back in the early 2010s, but Bitcoin has been full of surprises. If history is any guide, the bitcoin will be auctioned off sooner rather than later.

John McAfee has been on a bit of an unfortunate downswing, so it's great to see a big name bringing in institutional support during a crisis like this. ;-)
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