

Silk Road Update: Federal Prosecutors File Separate Forfeiture Complaint - jstalin
http://www.popehat.com/2013/10/10/silk-road-update-federal-prosecutors-file-separate-forfeiture-complaint/

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eck
Question for someone who understands BTC better than I:

This seems to be the first case where a massive number of BTC were seized by
police. Since BTC is a consensus algorithm, what would happen if 51% of BTC
users wanted to take those BTC away from the FBI and give them to someone else
(or perhaps nobody, just remove them from existence and deflate the BTC) how
feasible would that be?

~~~
MacsHeadroom
The only thing consensus can do is use hashing power to vote on using a chain
made of blocks which is has already been determined to be mathematically
consistent by enormous amounts of hashing power OR to roll back that chain and
continue it from an old spot.

The only way to pull that money back from the US Gov would be to roll back all
transactions and block creation up to the point they took control of those
bitcoins. But doing so would be catastrophic- so you would never get miners to
agree on that.

~~~
taejo
Miners could simply refuse to process future blocks which contain spends of
these bitcoins.

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fennecfoxen
Background information: The real awesome part of forfeiture is when the
government wants to seize your hotel and sell it because sometimes drug
dealers might have used it. [http://reason.com/blog/2013/01/28/motel-caswell-
owners-defea...](http://reason.com/blog/2013/01/28/motel-caswell-owners-
defeat-federal-forf)

Other victim classes include "driving while brown, with cash" \- e.g.
[http://reason.com/archives/2010/01/26/the-forfeiture-
racket](http://reason.com/archives/2010/01/26/the-forfeiture-racket)

(Disclaimer. Links to politically motivated Libertarian magazine website,
since I knew it would be easy to find there. Interested parties may conduct
corroborating research on their own time.)

~~~
ihsw
Keyword: might

They don't even have to have provided any evidence that crimes occurred on the
property in question, just that there is _reasonable_ suspicion.

There are a lot of penalties and procedures surrounding "just in case"
solutions.

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intslack
>The forfeiture complaint is considerably more blunt about the feds' position
that the entire Silk Road enterprise is inherently criminal

What a bunch of horseshit on part of the feds, while the market was
overwhelmingly populated with drugs I know for a fact that there were sellers
who only sold things like laptops, flash drives pre-loaded with anonymity
software, and DVDs of tails and such.

~~~
justinsb
Edit: intslack has fixed the quotation :-)

What are you quoting from?

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tjbiddle
I don't think it's a direct quote, I couldn't find it - but I'm assuming he's
speaking of the fact that the feds are treating all transactions as criminal.

------
aray
> What if some of those Bitcoins are yours, not Ulbrichts? What if Silk Road
> is holding some of your Bitcoins as part of some transaction? Why, all you
> have to do is show up and make a claim for them — in a case in which the
> government is saying that all or substantially all of the transactions
> through Silk Road are federal crimes. Bring a toothbrush.

Seems to answer the question of 'what happens to all the bitcoins' pretty
readily. Interesting discussion of forfeiture law and "in rem" suits at the
bottom, worth reading.

~~~
llamataboot
You can't just say depositing money on a site is a crime, there were plenty of
non-illegal things bought and sold at the Silk Road. Plus evidence of
intending to one day maybe buy something illegal is not evidence of having
bought something illegal.

Tangentially related, in the cases where the USG seized offshore gambling
sites, they returned deposits to the players, even though playing there was
ostensibly illegal.

Granted offshore gambling is a little murkier than buying heroin in terms of
legality, but see paragraph #1. Having funds at/on TSR is not a crime.

~~~
badman_ting
This is such a flimsy argument that I don't get why anyone bothers. I suppose
heavy-arms dealers should keep a pack of Twinkies with them at every sale.
Somehow it reminds me if the old myth that a cop has to tell you they're a cop
if you ask.

~~~
llamataboot
Not really. I have yet to see anything that would make depositing money on TSR
an illegal act or proof of intent to commit illegal activities.

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jstalin
The IP addresses listed are interesting: Latvia, Romania, Iceland, and New
York, USA.

