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From the beginning of TFA: > An extreme example which proves the point: the cryptocurrency enthusiast community largely believes that code is law, “not your ke

From the beginning of TFA: > An extreme example which proves the point: the cryptocurrency enthusiast community largely believes that code is law, “not your keys, not your coins”, etc. Many crypto enthusiasts would say that the Bitcoin protocol does not prohibit reversing transactions but provides a security guarantee which suggests that the likelihood of a reversal after an hour is infinitesimal. > And yet: someone sent $70 million worth of Bitcoin in 2016, and that transaction was partially voided, with the reversal being worth slightly more than $70 million due to Bitcoin volatility. This didn’t happen an hour later; it happened in 2022. How? > The answer is nowhere in the Bitcoin whitepaper or any codebase. A full recounting of it is outside the scope of this anecdote, but it rhymes with “If you and the United States federal government disagree whether a transaction is final, you are wrong.” That is true for notorious Bitcoin thefts, but also true for wire transfers, conveyances of real estate, credit card payments, and graverobbing. “Possession is nine-tenths of the law,” so the saying goes, but the state can conjure as many tenths as required if it is motivated to.

DennisP 5y ago
"How" is easy: they were storing their private key in an online account and the government found it. Nothing in Bitcoin was reversed. The government confiscated their funds in the same way that criminals steal any other bitcoins with poorly-secured keys. Just follow the link in the TFA if you want to verify that.
- jonas21 5y ago
  That's exactly the point. If you define the universe to include only Bitcoin, then yes, transactions are final. But if you define the universe to include the real world, then the answer is no, not really -- governments will almost always find a way to reverse the transaction, whether it's seizing your private key, or holding you in contempt of court until you divulge it.
  - repomies69 5y ago
    It is not "reversing the transaction", it is just seizure. If you have spent the Bitcoin on a lamborghini, government will confiscate the lambo. Criminals however typically spend the stolen money on hookers and drugs. Seizure or confiscation has nothing to do with "reversing the transaction", calling it that is just stupid, mixing terms unnecessarily is just unnecessary and confusing here.
  - tshaddox 5y ago
    The transaction was final though, in the real world. The fact that the government can physically find your private key (or physically compel you to give it to them) and use it to make new transactions is irrelevant. All you're pointing out is that after you receive money in a transaction you can later participate in a different transaction using that same money.
    - wewtyflakes 5y ago
      To the entity holding the coins, whether it is a single Bitcoin transaction as per the protocol of Bitcoin, or multiple transactions, makes no difference... ultimately they will or wont be holding a certain number of Bitcoins. To then say, "well technically that was _two_ transactions" seems irrelevant, since to the entity (no longer) holding the coins, things have been effectively reversed. I think may just be highlighting a disconnect between the writer of the article using the term transaction as understood by a layperson, and people who want to use the term transaction as per specific meaning of a particular protocol.
      - tshaddox 5y ago
        > To the entity holding the coins, whether it is a single Bitcoin transaction as per the protocol of Bitcoin, or multiple transactions, makes no difference... ultimately they will or wont be holding a certain number of Bitcoins. But to the entity who received the coins, it also doesn't matter where the coins went after someone took them by force. If you get paid for a day's work in cash and a robber steals it on your way home, you wouldn't say that your work payment transaction was reversed or that it hadn't been finalized up to the point of the robbery.
        wewtyflakes 5y ago
        I think that example breaks down for the laymen understanding of a transaction, since the robber is a different party than who gave the coins in the first place. What if an employer paid you in coins, so you take your coins and go home, then tomorrow your employer decides to take back the coins they gave you since they were not happy with your work (or they're just jerks)? I think that would fit the layman understanding of "this was undone!" (i.e. the transaction wasn't final). If in this case, the underlying financial engines used two, none, or one transaction (as specifically defined by that engine), probably wouldn't matter to the one who no longer has their coins.
  - robot_no_419 5y ago
    If you make a Bitcoin address, memorize the private key, and never write it down ever, then the only way for anyone to "reverse" transactions is to force you to physically say or write down the private key. This transaction finality seems to be orders of magnitude more final than a credit card transaction or a bank transaction. So sure - it's technically reversible. But is this really a practical argument? It's like saying nobody is safe in public because you can be a victim of a terrorist attack any any moment. It's alarmist and practically wrong even if technically true.

DennisP 5y ago

"How" is easy: they were storing their private key in an online account and the government found it. Nothing in Bitcoin was reversed. The government confiscated their funds in the same way that criminals steal any other bitcoins with poorly-secured keys. Just follow the link in the TFA if you want to verify that.

jonas21 5y ago
That's exactly the point. If you define the universe to include only Bitcoin, then yes, transactions are final. But if you define the universe to include the real world, then the answer is no, not really -- governments will almost always find a way to reverse the transaction, whether it's seizing your private key, or holding you in contempt of court until you divulge it.
- repomies69 5y ago
  It is not "reversing the transaction", it is just seizure. If you have spent the Bitcoin on a lamborghini, government will confiscate the lambo. Criminals however typically spend the stolen money on hookers and drugs. Seizure or confiscation has nothing to do with "reversing the transaction", calling it that is just stupid, mixing terms unnecessarily is just unnecessary and confusing here.
- tshaddox 5y ago
  The transaction was final though, in the real world. The fact that the government can physically find your private key (or physically compel you to give it to them) and use it to make new transactions is irrelevant. All you're pointing out is that after you receive money in a transaction you can later participate in a different transaction using that same money.
  - wewtyflakes 5y ago
    To the entity holding the coins, whether it is a single Bitcoin transaction as per the protocol of Bitcoin, or multiple transactions, makes no difference... ultimately they will or wont be holding a certain number of Bitcoins. To then say, "well technically that was _two_ transactions" seems irrelevant, since to the entity (no longer) holding the coins, things have been effectively reversed. I think may just be highlighting a disconnect between the writer of the article using the term transaction as understood by a layperson, and people who want to use the term transaction as per specific meaning of a particular protocol.
    - tshaddox 5y ago
      > To the entity holding the coins, whether it is a single Bitcoin transaction as per the protocol of Bitcoin, or multiple transactions, makes no difference... ultimately they will or wont be holding a certain number of Bitcoins. But to the entity who received the coins, it also doesn't matter where the coins went after someone took them by force. If you get paid for a day's work in cash and a robber steals it on your way home, you wouldn't say that your work payment transaction was reversed or that it hadn't been finalized up to the point of the robbery.
      - wewtyflakes 5y ago
        I think that example breaks down for the laymen understanding of a transaction, since the robber is a different party than who gave the coins in the first place. What if an employer paid you in coins, so you take your coins and go home, then tomorrow your employer decides to take back the coins they gave you since they were not happy with your work (or they're just jerks)? I think that would fit the layman understanding of "this was undone!" (i.e. the transaction wasn't final). If in this case, the underlying financial engines used two, none, or one transaction (as specifically defined by that engine), probably wouldn't matter to the one who no longer has their coins.
- robot_no_419 5y ago
  If you make a Bitcoin address, memorize the private key, and never write it down ever, then the only way for anyone to "reverse" transactions is to force you to physically say or write down the private key. This transaction finality seems to be orders of magnitude more final than a credit card transaction or a bank transaction. So sure - it's technically reversible. But is this really a practical argument? It's like saying nobody is safe in public because you can be a victim of a terrorist attack any any moment. It's alarmist and practically wrong even if technically true.