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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

#141

Post by Scoundreller »

modeless wrote: post #128
ineedasername wrote: post #80

Earlier quoted context omitted.

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…

The funny thought is that once the creditors are paid off in dollars/yen, the remainder goes to the shareholders that usually get wiped out in a bankruptcy, but not this one.

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

#142

Post by gamblor956 »

nullc wrote: post #117
colinmhayes wrote: post #50

Earlier quoted context omitted.

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.

That would be my assumption, but I'm confused: The statute of limitations would have expired already for the crimes they mention in their court filings.

Some actions can extend the statute of limitations. In almost all states, fleeing the jurisdiction pauses the statute of limitations for the duration the suspect is not in the state. (Some states consider leaving the jurisdiction to be the same as fleeing, even if the intent was not to avoid criminal charges.)

Concealment is also generally grounds for tolling the statute.

And in some states, if criminal acts are related, the statute for the entire body of crimes doesn't begin until the last related criminal act.

See for a breakdown by state: https://criminal.findlaw.com/criminal-law-basics/time-limits...

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

#143

Post by shitlord »

spurgu wrote: post #112
seibelj wrote: post #58

Earlier quoted context omitted.

Luckily there is Monero https://www.getmonero.org/

Not sure why you're getting downvoted, to my knowledge you're correct.

The IRS even has a $625k bounty for anyone who can break privacy coins like Monero!

https://heraldsheets.com/irs-will-pay-625000-cracks-monero-n...

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

#144

Post by klodolph »

anonAndOn wrote: post #129
gamblor956 wrote: post #90

Earlier quoted context omitted.

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-...

That's for "refusal to testify".

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

#145

Post by overkalix »

ramenmeal wrote: post #118
LiquidSky wrote: post #100

Earlier quoted context omitted.

>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. Jus…

Disclaimer, I know very little about bitcoin. If you owe the IRS tax money, they can take the money from your bank account without asking. They just do it. Can the same be done with bitcoin? As far as I know, they aren't able to. If that's the case, there's a difference.

PPPSS. (Previous Poster's Point Still Stands). You could have cash buried in the desert and the IRS wouldn't be able to take it. Bitcoin is a way with both advantages and disadvantages to hide money, but it doesn't teleport you to another plane of reality where you're immune to the violence of the state.

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

#146

Post by shiado »

gamblor956 wrote: post #71
shiado wrote: post #67

What's fascinating is that it is the view of the state that the creation of a hard fork, which is the creation of new and previously non-existing coins according to how Bitcoin is taxed by the IRS, is considered to be the proceeds of crime. It is philosophically notable that a piece of property can come into existence and immediately be considered the proceeds of crime in this way.

The Bitcoin Cash coins were received solely as a result of owning coins that were the proceeds of a crime, therefore, the BC coins were themselves also deemed the proceeds of a crime.

Under US forfeiture laws proceeds is defined as the following:

(A) In cases involving illegal goods, illegal services, unlawful activities, and telemarketing and health care fraud schemes, the term “proceeds” means property of any kind obtained directly or indirectly, as the result of the commission of the offense giving rise to forfeiture, and any property traceable thereto, and is not limited to the net gain or profit realized from the offense.

I suppose the BTC itself would be covered under "property of any kind obtained directly or indirectly, as the result of the commission of the offense giving rise to forfeiture"

And the BCH split coins would fall under "and any property traceable thereto, and is not limited to the net gain or profit realized from the offense."

It would appear that such a seizure is legit as 'traceable' is infinitely flexible. But I'm not a lawyer so don't take my word for it.

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

#147

Post by Scoundreller »

Aissen wrote: post #16
zaroth wrote: post #9

TFA says the suit seeks to seize the $1B in coins after an unknown hacker gained access to the funds. Forfeiture doesn’t mean destroying the coins. If the Fed can gain access to the coins they will auction them off. But if I understand correctly, this is the Fed basically laying a legal claim to and flagging coins that it doesn’t control therefore making them much more difficult to redeem, after seeing that they move…

The settlement would be an excellent idea. Big companies often make deals with governments over large amounts of tax they owe. If the hacker can walk with $50M clean and legal (and let the government have the rest), it's a pretty sweet deal.

The Silk Road may not have been their only hack either. The $1b may not be that big of a deal for them. Dunno what kind of immunity they would have received, but individual X must be happy that the US Gov got put their biggest enemy away for life.

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

#148

Post by overkalix »

SOLAR_FIELDS wrote: post #93
macspoofing wrote: post #35

Earlier quoted context omitted.

>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/

Event the url is relevant...

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

#149

Post by modeless »

Scoundreller wrote: post #141
modeless wrote: post #128

Earlier quoted context omitted.

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…

The funny thought is that once the creditors are paid off in dollars/yen, the remainder goes to the shareholders that usually get wiped out in a bankruptcy, but not this one.

In this case the majority shareholder is advocating for the money to be distributed to creditors rather than given to him. https://www.ccn.com/mt-gox-ceo-mark-karpeles-tells-creditors...

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

#150

Post by amatic »

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.

Well, it is stil a matter of research of how to maintain anonymity, and the best ones are keeping their secrets.
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