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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
by zaroth 6y ago
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 moved, which implies a hacker did manage to crack a wallet.
This story is the perfect example for how little privacy is actually afforded by the Bitcoin blockchain.
It’s unlikely the Fed has access to the coins, and that’s why the Bitcoin price just went up 7% because whoever cracked the wallet certainly isn’t going to hand over the coins.
Either those coins will never be spent, or the hacker will have to find a country willing to launder them and somehow keep the Fed at bay (doubt it), or if you’re the Fed maybe you arrange a settlement with the hacker to split the coins.
- Aissen 6y agoThe 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.
- Scoundreller 6y agoThe 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.
- kim0 6y agoBitcoin really missed the mark with respect to privacy and fungibility. I bet this guy wishes they were holding something like Monero now!
- gamblor956 6y agoTFA says that the coins were already seized by the U.S. government, not that they intend to do so. With respect to the lawsuit, note that this is how civil forfeiture works: the "defendant" is the property seized. In almost all U.S. jurisdictions, a civil forfeiture lawsuit can't be filed until the prosecuting agency is actual in custodial possession of the property. The point of the lawsuit is to give the lawful owners of the property the opportunity to challenge the seizure and get their property back.
- zaroth 6y agoSo weird, I think the article has been almost entirely rewritten since it was first posted...