FBI Seized 144,000 Bitcoins ($28.5 Million) From Silk Road Bust

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FBI Seized 144,000 Bitcoins ($28.5 Million) From Silk Road Bust

Posted by Soulskill on Saturday October 26, 2013 @01:33AM from the bet-he-wishes-he-cashed-out-sooner dept.

SonicSpike writes "An FBI official notes that the bureau has located and seized a collection of 144,000 bitcoins, the largest seizure of that cryptocurrency ever, worth close to $28.5 million at current exchange rates. It believes that the stash belonged to Ross Ulbricht, the 29-year-old who allegedly created and managed the Silk Road, the popular anonymous drug-selling site that was taken offline by the Department of Justice after Ulbricht was arrested earlier this month and charged with engaging in a drug trafficking and money laundering conspiracy as well as computer hacking and attempted murder-for-hire. The FBI official wouldn't say how the agency had determined that the Bitcoin 'wallet' — a collection of Bitcoins at a single address in the Bitcoin network — belonged to Ulbricht, but it was sure they were his. 'This is his wallet,' said the FBI official. 'We seized this from DPR,' the official added, referring to the pseudonym 'the Dread Pirate Roberts,' which prosecutors say Ulbricht allegedly used while running the Silk Road."

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144,000 bitcoins by Anonymous Coward · 2013-10-26 01:40 · Score: 0

Sounds like unlimited arcade games for those lucky to get divvied in to the stash.
1. Re:144,000 bitcoins by flyneye · 2013-10-27 02:00 · Score: 1
  
  Well, if they overstate the value of the bitcoin like they overstate the value of siezed drugs, they got about $3.24 in bitcoin...
  Other probabilities include, but are not limited to; Drug trafficking; smoking a joint with the UPS guy. Money Laundering; Buying office supplies via bitcoin. Computer hacking; installing TOR. Murder for hire: Called Orkin for exterminator.
  C'mon , who can believe a fucking word ANYONE involved in Federal Government says? How about when it's reported by Newsclowns?
  Uhm , yeah, you get my drift.
  
  --
  *Repent!Quit Your Job!Slack Off!The World Ends Tomorrow and You May Die!
Well by ledow · 2013-10-26 01:46 · Score: 4, Interesting

They may have "seized" them, but unlike with physical property, how can they be sure they are "unspent" and still worth-ful?
What if, when they try to convert them to cash, they are told they've already appeared in the blockchain and have been "spent" elsewhere? Would that not be quite embarrassing? That, from under the noses of the FBI, someone has recovered all that money via an anonymous currency exchange and ran off with the proceeds?
I sincerely hope that they cash in the Bitcoins before something appears on the blockchain from that wallet. Double-spending is blocked, but that doesn't mean the FBI would be the first person to try to spend them. Especially not now they've put it on the news. Anyone could have a copy of that wallet.
1. Re:Well by Immerman · 2013-10-26 01:58 · Score: 4, Informative
  
  Why convert them to cash? They can't freeze the account as they could with a bank, but if they have the account credentials they can simply transfer all the bitcoins to a new holding account to which they have the only credentials.
  
  --
  --- Most topics have many sides worth arguing, allow me to take one opposite you.
2. Re:Well by p.g.king · 2013-10-26 02:10 · Score: 5, Informative
  
  ...but if they have the account credentials they can simply transfer all the bitcoins to a new holding account to which they have the only credentials.
  Which is exactly what the article suggests they've done:
  "The FBI official pointed me towards this Bitcoin address, which according to the public Bitcoin transaction record known as the “blockchain” received transfers of close to 144,000 in just the last 24 hours. “They finished moving them at 3am this morning,” said the official."
3. Re:Well by Anonymous Coward · 2013-10-26 02:29 · Score: -1
  
  ALL must drop to there knees, for the unruly neo-communists known as the federal US government know all that is good for PR and the American People.
  All hail Satan,,
  HAIL, OUR DARK OVERLORD!!!
4. Re:Well by Anonymous Coward · 2013-10-26 02:48 · Score: 1
  
  Assuming they have an expert knowledgeable about bitcoin on their staff - I'm sure the first thing they do is transfer them to a new address for "safe keeping", preventing the original owner from doing so at a later time.
  The fact that so much bitcoin was in a single wallet to begin with is pretty poor planning on DPR's part... someone with that much BTC should probably be a bit more careful about where it's located.
5. Re:Well by pla · 2013-10-26 02:57 · Score: 5, Interesting
  
  This leads to an interesting problem for the FBI...
  
  They can either keep them in that account forever, basically useless to anyone...
  Convert them to US dollars, just about the single most Bitcoin-legitimizing action I can imagine...
  Or they can actually use them as Bitcoins.
  
  The last one gets interesting, because the FBI has accidentally revealed their own current address by this large transfer to themselves. Bam, we have one "known bad" address. Anyone they trade with, then, becomes tainted by association. Would you trust, for example, a VPN service that has accepted payments from the FBI?
6. Re:Well by hibiki_r · 2013-10-26 03:19 · Score: 5, Insightful
  
  It's an extremely uninteresting problem.
  Tainted by association makes no sense at all. If you limit the association to direct association, it's trivial to bypass by creating intermediaries. If you make the taint spread, then almost everyone is tainted, so there's nothing to gain. You might as well try to avoid people that are 7 degrees of separation or less from Kevin Bacon.
7. Re:Well by slashmydots · 2013-10-26 03:31 · Score: 1
  
  You clearly have no idea how bitcoins work whatsoever. You can tell if they're spent or not. "Spending" them changes ownership over to a new wallet. The wallet file is basically a deed to bitcoins floating around in the network and it specifically says in realtime how many you own.
8. Re:Well by p.g.king · 2013-10-26 03:32 · Score: 2
  
  Well previously they had said they would cash them in (http://www.forbes.com/sites/kashmirhill/2013/10/04/fbi-silk-road-bitcoin-seizure/) in.
  I don't see anything in doing that about legitimizing them, as far as I am aware the FBI don't contend them to be illegal anyway.
  I doubt the FBI is worried about them accidentally revealing their own address, in fact if anyone wants to decide that makes someone dealing with them tainted, then they could of course leverage that, pay for a VPN account with every provider you don't currently have some snooping deal with, thus driving people to the ones you do have influence with.
9. Re:Well by Anonymous Coward · 2013-10-26 03:51 · Score: -1
  
  Keeping them in that account won't make them useless to anyone.
  Keeping them in that account will mean that Ross is still able to use them. And he will and already has if they keep them in that account.
  Wait you think he didn't have other copies of a couple short strings of characters? (public/private key)
  You have a very strange idea of how the bitcoin protocol works.
10. Re:Well by pla · 2013-10-26 03:57 · Score: 1
  
  Tainted by association makes no sense at all.
  
  It works well enough for them to use against us.
  
  Yes, it catches some innocents. And yes, eventually the "contagious" taint becomes too dilute to take seriously. But for a few layers of transactions, I for one wouldn't touch any BTC within a few generations of separation of this transactions if you offered to just give it to me for nothing.
  
  By way of analogy - Would you, given the chance, choose to get it on with your favorite supermodel, if you knew that she had ridden the Magic Johnson bareback just a few months earlier?
  
  Y'know, on reflection, that attitude (my own) really bothers me. I find it so utterly abhorrent that I consider the agents of my own government so untrustworthy that I don't even trust those they do business with... I remember, once upon a time, believing that the government existed to help us.
  
  Then again, I suppose I believed in the Easter Bunny once upon a time, too.
11. Re:Well by pla · 2013-10-26 04:05 · Score: 2
  
  Keeping them in that account will mean that Ross is still able to use them.
  
  By "that account", I mean the one they transferred them into immediately after taking possession of RU's wallet.
  
  You have a very strange idea of how the bitcoin protocol works.
  
  You clearly didn't RTFA.
  I've written my own miner.
  
  I'll take that definition of "strange, if you like.
12. Re:Well by Anonymous Coward · 2013-10-26 04:33 · Score: 0
  
  ... and it specifically says in realtime how many you own.
  Realtime [sic]? Nope. A confirmation takes ~5-10 minutes.
  6 confirmations (often required by exchanges/merchants) can take an hour or so.
  Are you sure YOU know how bitcoins work?
13. Re:Well by PPH · 2013-10-26 04:40 · Score: 2
  
  I wouldn't be surprised if the NSA has cracked the encryption involved in BitCoin transactions. One day soon, the FBI will examine their account balance and find it empty. The BitCoins having been transferred through the NSA to the CIA to fund some assassinations. Or to the next al Qaida.
  
  --
  Have gnu, will travel.
14. Re:Well by Anonymous Coward · 2013-10-26 04:46 · Score: 1
  
  Or they could auction them off, like they do a lot of stuff.
15. Re: Well by RyuuzakiTetsuya · 2013-10-26 04:51 · Score: 1
  
  Of course they're not illegal. Bit coins are Disney dollars that are useful. The FBI just cares about the drugs and attempted murder.
  
  --
  Non impediti ratione cogitationus.
16. Re:Well by um...+Lucas · 2013-10-26 05:03 · Score: 1
  
  They're in a brand new wallet; all the coins were transferred in on 10/25/2013. So even if someone had a backup of DPR's wallet (which they don't, otherwise they would have moved them themselves already), the coins are gone from it now. And if the coins had already been spent, it would be obvious, too (the block chain.info link above would show a zero balance).
  Moral of the story; Crime pays. Lots. But what good is that if you can't benefit from that pay?
17. Re:Well by Anonymous Coward · 2013-10-26 05:06 · Score: 0
  
  You spread it with decay, or do some sort of Bayesian analysis. If it does 1/1 transactions with tainted nodes, it's tainted, it it does 1/10 transactions within a cluster of tainted nodes you give it a score of .5 tainted. 1/100- .1 tainted and 1/1000 the same as zero.
18. Re:Well by um...+Lucas · 2013-10-26 05:14 · Score: 1
  
  So, your government arresting someone who allegedly tried to have two people executed isn't helping you? Not only tried, but he thought he succeeded. His jaw probably hit the floor when he found out both his hits were nothing more than fantasies in his own mind.
19. Re:Well by pipelayerification · 2013-10-26 05:15 · Score: 1
  
  He is the Center of the Universe
20. Re:Well by ultranova · 2013-10-26 05:24 · Score: 2
  
  Convert them to US dollars, just about the single most Bitcoin-legitimizing action I can imagine...
  
  Which might actually be a good move. US dollar is going to undergo hyperinflation when the petrodollar scheme collapses and all those bucks return home, so by moving as much of the economy as possible to alternatives helps minimize the damage. At the far extreme, if the entire US economy uses something else than the dollar the Fed is free to treat it as monopoly money and simply laugh as its debt dissolves. And Bitcoin is a good substitute - it's not controlled by any (other) country, it's designed for the Interent economy, it's impossible to forge, all transactions are public knowledge...
  I doubt the US government has such foresight and capacity for long-term planning, but an agency leader might.
  
  Would you trust, for example, a VPN service that has accepted payments from the FBI?
  
  Is there some reason to not to? The FBI can simply order a VPN to betray its customers, it doesn't need to bribe them.
  
  --
  Forget magic. Any technology distinguishable from divine power is insufficiently advanced.
21. Re:Well by pla · 2013-10-26 05:44 · Score: 1
  
  So, your government arresting someone who allegedly tried to have two people executed isn't helping you?
  
  Accidentally doing some good in the process of defending corporate interests doesn't redeem them as a whole, any more than a mob boss "keeping the peace" in his home neighborhood make him a net benefit to society.
22. Re:Well by Anonymous Coward · 2013-10-26 05:45 · Score: 0
  
  allegedly tried to have two people executed
  Is there a non-government source for that allegation? I don't know about you, but when an organization lies as many times as the US government has, I tend to treat their claims with a fair bit of skepticism.
23. Re:Well by Anonymous Coward · 2013-10-26 05:49 · Score: 0
  
  For the purposes of the discussion, an hour certainly counts as "realtime".
24. Re:Well by Anonymous Coward · 2013-10-26 06:01 · Score: 0
  
  Money wasn't "recovered" it was never anyones to recover to begin with. It was spent in mutual and conceptual trade. Between consenting parties. What it was used to buy doesn't change that fact.
25. Re:Well by Anonymous Coward · 2013-10-26 06:04 · Score: 0
  
  U.S. Government is more likely to assassinate your than Ross Ulricht is lol
  Either those two people had it comin through association or whatever. Assasins don't scare me. Overarching authoritative control of peoples minds and lives does.
26. Re:Well by Shishak · 2013-10-26 06:23 · Score: 1
  
  Assets seized during a drug bust go to the arresting agency. In this case the FBI gets the asset (bitcoin) which they can do anything they want with. Assuming they have the private key and/or they have brute forced the private key password. They can convert the coins to dollars. Dumping 144k coins into the market will decimate the market price so they will have to do it slowly. They will probably use the money to buy more Bearcats for domestic oppression.
  
  --
  Now I hope and pray that I will But today I am still, just a bill
27. Re:Well by tibman · 2013-10-26 06:48 · Score: 1
  
  Seems like it wouldn't affect the market more than 3 or 4%
  
  --
  http://soylentnews.org/~tibman
28. Re:Well by pepty · 2013-10-26 07:27 · Score: 1
  
  I think they hold on to them for quite a while as "evidence" while they try to find out the identities of people who sent money to/through SilkRoad. Not that spending them would affect that investigation at all, but just for appearances sake when the court cases happen. My guess: four+ years from now they will auction them off.
29. Re:Well by Anonymous Coward · 2013-10-26 07:54 · Score: 0
  
  Allegedly.
  If he is tried by due process and convicted beyond reasonable doubt, I would support seizure of assets acquired from the proceeds of those crimes AFTER the prosecutors proved beyond reasonable doubt that they could have come from no other source.
  But it isn't even exactly clear what the government claims that he did. They aren't exactly saying that he bought drugs or sold drugs himself, or that he ever had any in his possession. They aren't exactly saying that he actually had anybody killed, only that he might have tried to buy two murders-for-hire. At worst, he provided an unrestricted marketplace where state-prohibited goods might have been sold (allegedly).
  Since it isn't clear that the bitcoins he had were actually the proceeds from unlawful activity, there is no due-process reason for them to be seized, other than "We're the government, we can do it, and therefore we will, since that's one of the things we do to prevent a defendant from mounting a proper (and expensive) defense against all the charges we will be piling on to encourage a plea deal."
30. Re: Well by SuricouRaven · 2013-10-26 08:09 · Score: 1
  
  The FBI does have reason to care: Silk Road demonstrated the power of bitcoins in concealing payments for illegal goods, complicating their investigation. If bitcoin usage continues to spread, it could complicate future investigations too. Also, other government departments might apply pressure to the FBI to avoid legitimizing the currency.
31. Re:Well by SuricouRaven · 2013-10-26 08:15 · Score: 1
  
  But there are political concerns too. The FBI is unlikely to take that route because it could be seen as somehow endorsing bitcoins as a currency. More likely they'll just keep the wallet as evidence until all the legal proceedings are over, then destroy it according to routine procedure.
32. Re:Well by Agent+ME · 2013-10-26 08:25 · Score: 1
  
  Checking if they're already used is ... not just a standard feature of every bitcoin wallet, but the way it works practically necessitates that.
  Anyway, they've already moved the bitcoins to an address they control, so there's no chance of someone else moving the bitcoins first before them. https://blockchain.info/address/1FfmbHfnpaZjKFvyi1okTjJJusN455paPH?offset=400&filter=0
33. Re: Well by Rhacman · 2013-10-26 08:35 · Score: 1
  
  Seized property is auctioned all the time without acknowledging said property as a currency. All they'd be acknowledging is that they possess something they have no use for that someone is willing to buy.
  
  --
  Account -> Discussions -> Disable Sigs
34. Re:Well by HJED · 2013-10-26 10:28 · Score: 1
  
  They aren't exactly saying that he actually had anybody killed, only that he might have tried to buy two murders-for-hire.
  
  Yes, they are saying that. It was one of the things he was charged with and its on his arrest warrant. (which I'll let you google, it's public record)
  
  --
  null
35. Re:Well by drinkypoo · 2013-10-26 11:32 · Score: 1
  
  I doubt the US government has such foresight and capacity for long-term planning, but an agency leader might.
  Whatever drugs you're on, or medication you're skipping, you should lay off. History shows us that the US government is completely capable of long-term planning, as long as we don't make wild and stupid assumptions about their goals.
  
  --
  "You're right," Fisheye says. "I should have set it on 'whip' or 'chop.'"
36. Re:Well by Anonymous Coward · 2013-10-26 15:15 · Score: -1
  
  Man you did it, you went full retard. Never go full retard.
37. Re:Well by rtb61 · 2013-10-26 15:30 · Score: 1
  
  They can also simply close the account and destroy the bitcoins, meaning the remaining bitcoins will be worth slightly more. We all of course know exactly what they are going to do. They will play with the IRS and use those bitcoins in various criminal investigations to catch people foolish enough to now use them.
  
  --
  Chaos - everything, everywhere, everywhen
38. Re:Well by radarskiy · 2013-10-26 16:36 · Score: 1
  
  "Would you trust, for example, a VPN service that has accepted payments from the FBI?"
  Why would getting paid make them more or less untrustworthy? Would you trust a VPN service that let's the FBI in for free?
  "Anyone they trade with, then, becomes tainted by association."
  Don't look now, but of the 10 currencies of which I currently have paper bills ALL of them have easily OCR-able serial numbers. Oh noes!
39. Re:Well by Anonymous Coward · 2013-10-26 19:42 · Score: 0
  
  Unless the entire miner community reprograms all of their GPUs to brute-force the private key associated with that address.
40. Re: Well by O('_')O_Bush · 2013-10-26 19:46 · Score: 1
  
  The FBI really doesn't give a rats ass about corporate interest. They certainly aren't running campaigns or being lobbied, so the best you could claim is weak and indirect influence.
  
  However, they are very interested in hitmen and those that hire them.
  
  --
  while(1) attack(People.Sandy);
41. Re: Well by jonbryce · 2013-10-26 20:16 · Score: 1
  
  They seize inventory of drugs quite often in these sorts of heists, and they don't auction that off, because it is illegal property. They will auction off the cars, watches and so on, because it is legal for people own those sorts of things. If they auction off the bitcoins, then they are acknowledging that it is legal to own and sell them.
42. Re: Well by Anonymous Coward · 2013-10-26 20:53 · Score: 0
  
  AFAIK, in US everything that is not explicitly illegal is legal. "Avoiding auctioning them" does nothing to Bitcoin's legitimacy in either way then, only direct action against owning them does.
  Oh, and you probably should declare your Bitcoin income to IRS, just like any other income.
  PS: Why are you people so stuck on US acknowledging/not acknowledging BitCoin, anyways?
43. Re: Well by jonbryce · 2013-10-26 22:22 · Score: 1
  
  If the Fed sells them, then it is an endorsement of their legality. If you buy bitcoins from the Fed, then they can't complain about what you do with them unless they could complain about you doing the same thing with US Dollars or Euros in similar circumstances.
  I don't know what the position in the US is. I live in Europe, and as far as I can see, they are illegal here because they don't comply with the Electronic Money directive, and I don't think it is possible for them to comply with it.
  Paypal for example is registered as an electronic money issuer under these regulations with the Luxembourg authorities. That allows them to operate anywhere in the EU. In the US, as far as I'm aware, Paypal is registered with all the individual state governments as a money transfer agent, so clearly the rules are very different. It is the act of transferring money about that needs to be registered rather than having Paypal balances existing in electronic form. So maybe the likes of Mtgox could register as a money transfer agent. But what about people who transfer bitcoins themselves using bitcoin software? Does that need to have someone registered as a money transfer agent to allow it to happen?
44. Re: Well by pla · 2013-10-27 02:31 · Score: 1
  
  The FBI really doesn't give a rats ass about corporate interest.
  
  Perhaps you can explain their obsession with Aaron Swartz, then, at worst a two-bit hacker who trespassed on a college campus and made two well-known organizations look a bit silly (if not outright monstrously callous, though that part only came after)?
45. Re: Well by Anonymous Coward · 2013-10-27 03:33 · Score: 0
  
  Silk Road demonstrated the power of bitcoins in concealing payments for illegal goods, complicating their investigation
  Nope, 100% wrong. bitcoins did not conceal anything. bitcoins are worthless unless people are willing to accept them, and outside of the Silk Road the only people willing to accept them are people who think they can use an exchange to turn them back into real money. With Silk road gone, that almost completely eliminates their usefulness. And when the FBI eventually cashes them in, it's going to massively devalue the currency as a whole.
46. Re:Well by radiumsoup · 2013-10-27 04:58 · Score: 2
  
  Except for that pesky fact that "no, that won't happen."
  https://bitcointalk.org/index.php?topic=139735.msg1494135#msg1494135
47. Re:Well by Hentes · 2013-10-27 10:56 · Score: 1
  
  Convert them to US dollars, just about the single most Bitcoin-legitimizing action I can imagine...
  It would also cause the biggest crash in BTC history, likely cancelling any "legitimization" factor.
48. Re: Well by RyuuzakiTetsuya · 2013-10-27 11:49 · Score: 1
  
  More than likely, they'll archive all the data for future possible uses, wipe the drives and auction off the machine.
  In essence, the money would be locked up unless someone else had access to that wallet.
  In so far as I know, the federal government doesn't auction off digital goods like iTunes or Steam purchases like they do with seized goods. Why they auction this stuff off is because land is finite and hosting piles of seized cars, boats, computers, etc. takes up space needlessly.
  
  --
  Non impediti ratione cogitationus.
Here is my question.... by Lumpy · 2013-10-26 01:49 · Score: 1

If the feds have seized the file he had with them in it, would someone be able to sped a copy of that file? Does bitcoin have a way to let you "back up" your money so that in the case of a government raid you secret copy elsewhere can be put into action and use the bitcoins for your defense fund, etc? Because it is well known the feds will seize all assets right away to prevent the accused from being able to afford good council and fight in court. If you don't have access to your money, you cant hire good lawyers.
Because if this is the case, then I look at bitcoin with more interest and a different light, was that by design or by accident?

--
Do not look at laser with remaining good eye.
1. Re:Here is my question.... by Anonymous Coward · 2013-10-26 02:03 · Score: 1
  
  Actually that is exactly how it works. If you have more than one copy of your private keys, any of those copies can spend the coins.
2. Re:Here is my question.... by Immerman · 2013-10-26 02:07 · Score: 4, Informative
  
  Your bitcoins aren't in your "wallet" file - they're in an account in the bitcoin block chain "bank". The file simply contains your credentials to be able to transfer those coins. You can back up those credentials, in fact it's strongly recommended since if you lose them (say to a hard drive crash) the coins in the account become permanently unspendable. And anybody with a copy of those credentials can indeed spend the money in the account. I would imagine though that a seizure involves gaining access to the credentials and transferring those bitcoins into an exclusively FBI controlled account to avoid just such a scenario.
  By the same token, if you securely encrypt your credentials and refuse to give them the key despite any threats they may bring, they can't meaningfully seize those assets. Of course that "sharing" may come involuntarily via surveillance software surreptitiously installed on your computer.
  
  --
  --- Most topics have many sides worth arguing, allow me to take one opposite you.
3. Re:Here is my question.... by p.g.king · 2013-10-26 02:08 · Score: 3, Interesting
  
  The article states:
  "The FBI official pointed me towards this Bitcoin address, which according to the public Bitcoin transaction record known as the “blockchain” received transfers of close to 144,000 in just the last 24 hours. “They finished moving them at 3am this morning,” said the official."
  So no, they have already "spent" them by transferring them to another address. If they've already been spent then Bitcoin shouldn''t allow them to spent again from a "backup", otherwise it'd be worthless as a currency, you buy X from me with the coins, I send you X, then you can spend them again rom this backup depriving me of the value.
4. Re:Here is my question.... by nospam007 · 2013-10-26 02:16 · Score: 1, Funny
  
  "If the feds have seized the file he had with them in it, would someone be able to sped a copy of that file? "
  That's exactly right. The new Dread Pirate Roberts already spent them, even if the FBI finds that 'Inconceivable!'
  They keep using that word, but I don't think it means what they think it means.
5. Re:Here is my question.... by bill_mcgonigle · 2013-10-26 03:14 · Score: 3, Interesting
  
  This is my real take-away from the article: DPR trusted nobody for important things that need trust and trusted many people for things that should not have had trust (e.g. doing co-lo in San Franscisco). He could have easily hired two(+) attorneys in foreign jurisdictions and had them combine the key parts in the event of his capture and transfer the funds to a legal defense fund. Obviously, he didn't or the FBI would have bupkis.
  Trust needs to be managed, not avoided.
  
  --
  My God, it's Full of Source!
  OUTSIDE_IP=$(dig +short my.ip @outsideip.net)
6. Re:Here is my question.... by Wrath0fb0b · 2013-10-26 05:04 · Score: 1
  
  By the same token, if you securely encrypt your credentials and refuse to give them the key despite any threats they may bring, they can't meaningfully seize those assets. Of course that "sharing" may come involuntarily via surveillance software surreptitiously installed on your computer.
  If it's a legal case (and not some black-ops) and they have a legitimate order, they can compel you to transfer the money or throw you in jail for contempt (note, I didn't say you have to give them the key, only transfer the money). This sort of thing happens all the time in nasty divorce cases where one spouse tries to lock the money up where the court and the other spouse cannot find it. A few persist and spend a long time in jail.
  That is, most people have a really way-too-technical notion of what "seizure" usually entails. In most cases that don't involve the SWAT, it just means ordering someone to do something. In the case of divorcees that don't want to abide the decision of the Family Court, this seems like the expedient way to do it.
7. Re:Here is my question.... by Immerman · 2013-10-26 06:29 · Score: 1
  
  Well, no, they can't directly compel you to do such a thing - they can threaten you, and possibly carry out those threats if you fail to comply, but it has to be a voluntary action. They can also (and several times have) go directly to the financial institution and freeze or seize the assets via that route, bypassing your will entirely. And that is the route that bitcoin removes. Unlike cash they can't physically seize the assets. And unlike a bank there is no third party to compel. If it's important enough, you're careful enough, and the interrogation is insufficient to break your will, then you have the option of denying them the ability to seize your account.
  
  --
  --- Most topics have many sides worth arguing, allow me to take one opposite you.
8. Re:Here is my question.... by Agent+ME · 2013-10-26 08:27 · Score: 1
  
  DPR's bitcoins were moved to a new wallet by the FBI to prevent that from happening already.
  https://blockchain.info/address/1FfmbHfnpaZjKFvyi1okTjJJusN455paPH?offset=400&filter=0
9. Re:Here is my question.... by Anonymous Coward · 2013-10-26 08:30 · Score: 0
  
  Thanks for clarifying that there are no mind control devices. I was under the impression that's what the person meant.
Seized? by Anonymous Coward · 2013-10-26 01:54 · Score: 0

Did they seize a file that is encrypted? That's not the equivalent of seizing bitcoins.
1. Re:Seized? by Anonymous Coward · 2013-10-26 02:01 · Score: 0
  
  i think if the wallet is encrypted they couldnt determine how many coins were in there, or the address without decrypting it. but i think whats extra funny, is that if they have the coins, the fbi/etc seems to think that cryptocurrencies are basically used for crime, so by converting them into USD at an exchange, they are being sold to criminals (like, not the exchange, but eventually) to fund more money laundering and organized crime. pure hilarious because to get any use from them, thats what they have to do. give millions of dollars to organized crime
2. Re:Seized? by Anonymous Coward · 2013-10-26 02:12 · Score: 1
  
  i think if the wallet is encrypted they couldnt determine how many coins were in there, or the address without decrypting it. but i think whats extra funny, is that if they have the coins, the fbi/etc seems to think that cryptocurrencies are basically used for crime, so by converting them into USD at an exchange, they are being sold to criminals (like, not the exchange, but eventually) to fund more money laundering and organized crime. pure hilarious because to get any use from them, thats what they have to do. give millions of dollars to organized crime
  Sure they can.
  FBI will have a new addition to their "uniform" - alpaca socks.
  And they can also buy absurd amounts of quality coffee. This is actually it, there is nothing else you can use your bitcoins for.
  http://yro.slashdot.org/story/13/10/26/1153212/fbi-seized-144000-bitcoins-285-million-from-silk-road-bust#
3. Re:Seized? by Immerman · 2013-10-26 02:13 · Score: 2
  
  The coins aren't in the wallet - they're in a completely transparent, publicly viewable account in the bitcoin block chain. Every transaction is visible to everyone. The wallet only contains the credentials that allow you to transfer the coins to another account. If the wallet was encrypted, and they were unable to access the credentials, then they cannot meaningfully seize the account since another copy of the credentials could (and should) exist elsewhere allowing someone else to spend the coins.
  
  --
  --- Most topics have many sides worth arguing, allow me to take one opposite you.
4. Re:Seized? by fredklein · 2013-10-26 02:19 · Score: 1
  
  FBI will have a new addition to their "uniform" - alpaca socks.
  And they can also buy absurd amounts of quality coffee. This is actually it, there is nothing else you can use your bitcoins for.
  Lies.
  http://usebitcoins.info/
  There are thousands of businesses that accept Bitcoins.
5. Re:Seized? by ddegirmenci · 2013-10-26 02:52 · Score: 1
  
  They could buy shitloads of reddit gold.
6. Re:Seized? by gmuslera · 2013-10-26 03:37 · Score: 1
  
  They can give them to organizations that accept bitcoins as donations. I don't think that they will pick Wikileaks, the Pirate Party, or even free software with focus in privacy, but i.e. Khan Academy or Sugar Labs are good neutral enough candidates that even they can agree that could give a good use to that donation..
7. Re:Seized? by Fnord666 · 2013-10-26 03:44 · Score: 3, Interesting
  
  The coins aren't in the wallet - they're in a completely transparent, publicly viewable account in the bitcoin block chain. Every transaction is visible to everyone. The wallet only contains the credentials that allow you to transfer the coins to another account. If the wallet was encrypted, and they were unable to access the credentials, then they cannot meaningfully seize the account since another copy of the credentials could (and should) exist elsewhere allowing someone else to spend the coins.
  Given that according to TFA, the Feds have already transferred the coins to another account that they hold and that the transfers are a part of the current accepted blockchain, I would say that they have seized them. A side effect is that by revealing the blockchain entry for the transfers, they have marked these coins as government owned and traceable for the rest of their existence.
  I wonder if it would be possible to also transfer the coins using a blockchain prior to the Fed transfer, then somehow replace the Fed transfer in the current blockchain and get the majority to accept the substitution, effectively denying the Feds their seizure? I realize that the majority design of Bitcoin is meant to prevent this sort of thing in reality, but it should be theoretically possible, right?
  
  --
  'The tyrant will always find pretext for his tyranny.' - Aesop's Fables
8. Re:Seized? by Anonymous Coward · 2013-10-26 04:34 · Score: 0
  
  Depends on how voluntarily they would accept it.
  If I understand correctly, you'd have to basically re-mine every block since the transfer, removing mentions of transfers to FBI wallet (and then re-mine all those blocks mined while you was doing it) - it's called a blockchain because every block has a hash of the previous block in the chain to link them, so you can't change just one.
  If everyone agrees to accept your version of block chain - you're done. If not - that's where "51%" comes in, you'll have to drive the majority of computing power and continuously mine new blocks agreeing with your version of reality ahead of the rest of the miners.
  But would you want to do that, really? Today you agree to punish big bad FBI, tomorrow you agree to punish a fly-by-night BTC exchange and day after tomorrow MtGox DDoSes a competing exchange, claims those did a fly-by-night and network lynches them.
  Would you want that precedent?
9. Re:Seized? by John+Jorsett · 2013-10-26 04:35 · Score: 1
  
  They can give them to organizations that accept bitcoins as donations. I don't think that they will pick Wikileaks, the Pirate Party, or even free software with focus in privacy, but i.e. Khan Academy or Sugar Labs are good neutral enough candidates that even they can agree that could give a good use to that donation..
  Unless Congress does it, that's called a "gift of public funds" and is, for obvious reasons, illegal.
10. Re:Seized? by Immerman · 2013-10-26 04:46 · Score: 1
  
  Yeah, if you control fifty-one percent of the bitcoin network then you can retroactively rewrite financial history. It'll be pretty obvious though, so don't expect the other 49% to simply accept it.
  
  --
  --- Most topics have many sides worth arguing, allow me to take one opposite you.
11. Re:Seized? by gwern · 2013-10-26 05:12 · Score: 1
  
  No, you can't 'rewrite history'. What the 51% attack lets you do is block any additional transactions by refusing to produce blocks with those transactions in them, which lets you do double-spends. However, you cannot spend someone else's coins because you cannot create valid signatures without their private keys.
12. Re:Seized? by ArbitraryName · 2013-10-26 05:13 · Score: 1
  
  Are there any that sell useful physical goods (not arts and crafts) at reasonable prices? I've never found one that isn't ridiculously expensive over shopping at a non-BTC store.
13. Re:Seized? by gmuslera · 2013-10-26 05:17 · Score: 1
  
  The problem is that the government don't recognize bitcoins as money, so giving it is not using them as public funds.
14. Re:Seized? by um...+Lucas · 2013-10-26 05:21 · Score: 1
  
  Yes, if you 51% the network. But you'd undo every payment that occurred since then, and you'd undo every miners block reward as well. Therefore, no one will possibly go along with that idea.
15. Re:Seized? by Anonymous Coward · 2013-10-26 05:26 · Score: 0
  
  Governement doesn't recognize cars as money too, but I don't think they're free to give seized drug dealers' cars away.
  Government does recognize bitcoin as valuable and IIRC expects you to declare them for tax purposes, so there.
16. Re:Seized? by JesseMcDonald · 2013-10-26 08:10 · Score: 1
  
  You can't spend someone else's coins without their private key, but you can rewrite history by coming up with a longer blockchain which does not include certain previously-accepted transactions. That would allow DPR, or someone else with his private key, to transfer the funds "before" the FBI moves them to a different account.
  At this point it would be really expensive to pull off, since the FBI's transfers are buried 346 blocks behind the head of the blockchain, but you could do it if you controlled 51% or more of the mining network for a long enough time. Assuming you had exactly 51% of the network, and started right now, it should take right at 120 days to overcome the current blockchain's lead. That gets significantly better as you control more of the network; in the best case, if 100% of the network went along with the scheme, it would only take two days.
  
  --
  "The state is that great fiction by which everyone tries to live at the expense of everyone else." - Bastiat
17. Re:Seized? by ArcadeMan · 2013-10-26 08:33 · Score: 1
  
  http://www.wtcr.ca/
  You can get an ASICMINER Block Erupter USB for only 0.05 BTC.
  
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18. Re:Seized? by gwern · 2013-10-26 08:41 · Score: 1
  
  You are not talking about the 51% attack as generally understood. You can't, because then you are talking about requiring far more than 51% of power for a few blocks: you need 51% of the network indefinitely to build a longer blockchain *and* you also need to defeat the checkpoints used by most clients & miners *and* defeat whatever community-based mechanisms happen.
19. Re:Seized? by Anonymous Coward · 2013-10-26 08:56 · Score: 0
  
  Foodler has been taking them for awhile.
20. Re:Seized? by JesseMcDonald · 2013-10-26 09:09 · Score: 1
  
  You wouldn't need 51% "indefinitely", just long enough to catch up and make your chain the longest blockchain. After that the rest of the network has a choice: follow the protocol and use your blockchain, or perform a deliberate 51% attack of their own.
  Checkpoints and other "community-based mechanisms" are outside of the Bitcoin protocol. In any case checkpoints are inserted into the official client on fairly rare occasions to cover blocks which are already well-established. There won't be any checkpoint protecting the FBI's transaction for some time.
  
  --
  "The state is that great fiction by which everyone tries to live at the expense of everyone else." - Bastiat
21. Re:Seized? by gwern · 2013-10-26 09:18 · Score: 1
  
  If you can beat the general network for 120 days (and increasing, and also the difficulty is generally increasing as well, making 120 days even more of a lower bound), then I don't see how that is meaningfully different from being able to do so indefinitely. A third of a year is a pretty long time.
22. Re:Seized? by JesseMcDonald · 2013-10-26 10:12 · Score: 1
  
  Beating the network indefinitely would cost about 60 times as much, assuming you can get a reliable 5% APY. (If a 120-day attack costs $X, then the yield from a 60*$X investment at 5% is sufficient to maintain the attack indefinitely.) A factor of 60 is a fairly large difference.
  That's assuming you only have 51%. The time required increases asymptotically as you approach 50%. At 60% the attack would take only 12 days, reducing your overall cost by an order of magnitude.
  
  --
  "The state is that great fiction by which everyone tries to live at the expense of everyone else." - Bastiat
23. Re:Seized? by gwern · 2013-10-26 10:20 · Score: 1
  
  Doesn't your investment claim make some false assumptions like difficulty remaining constant?
24. Re:Seized? by JesseMcDonald · 2013-10-26 17:05 · Score: 1
  
  I did assume a constant difficulty, or rather a constant cost to maintain the attack. In the end the difficulty is going to be determined mainly by the cost of energy, once all the efficiency gains (GPU vs. FPGA vs. ASIC, etc.) have been worked out. It won't keep increasing indefinitely. As difficulty increases, the profitability of mining decreases, which acts as negative feedback. On the other hand, if difficulty does increase, say by 1% per year, that just means you'd need even more seed money to offset the increasing cost. You'd need to pay for the attack with 4% and put the remaining 1% back into growing the investment, meaning you'd need 75 times as much money rather than 60 times. Which, ultimately, only reinforces my argument that a permanent 51% attack would be much more costly than a limited 120-day attack.
  
  --
  "The state is that great fiction by which everyone tries to live at the expense of everyone else." - Bastiat
Busted by Anonymous Coward · 2013-10-26 01:54 · Score: 0

Well, he took the risk, and paid the price.
1. Re:Busted by Opportunist · 2013-10-26 03:19 · Score: 2
  
  Should've opened a bank. There, you can take any kind of risk and we pay the price if it blows.
  
  --
  We used to have a Bill of Rights. Now, with the rights gone, all we have left is the bill.
2. Re:Busted by Sponge+Bath · 2013-10-26 04:57 · Score: 1
  
  Well, he took the risk, and paid the price.
  The Dude Pirate Roberts abides.
No proof by loufoque · 2013-10-26 02:06 · Score: -1

This whole seizing was done without any proof and is therefore illegal.
With all the violations of due procedure that the FBI made, Ulbricht should be fine, like the MEGA guy was.
1. Re:No proof by Anonymous Coward · 2013-10-26 02:16 · Score: 2
  
  the standard is not "proof", the standard is, they need to follow "due process", which I'm sure they are doing, though he is free to challenge it.
  it's like the old "if people are innocent till proven guilty, how can they hold you in jail till your trial?" answer: you are not innocent till proven guilty, you are entitled to the presumption of innocence in court, but outside the court, much more reasonable standards prevail, like "was a crime committed?" and "is there evidence that points to somebody?" That's how due process works.
2. Re:No proof by Immerman · 2013-10-26 02:23 · Score: 1
  
  Well, if they were able to seize the account (presumably meaning transfer the coins to a FBI-controlled account) then they at least know that it belonged to Person X, because they had to get the credentials from *someone*. So on that front what are you going to claim? "Honest officer, I was just holding this authorization to spend millions of dollars worth of bitcoins for a friend" ?
  Beyond that I can't say much as I haven't looked into the details of the case.
  
  --
  --- Most topics have many sides worth arguing, allow me to take one opposite you.
3. Re:No proof by Anonymous Coward · 2013-10-26 02:24 · Score: 0
  
  much more reasonable standards prevail
  Innocent unless proven guilty is reasonable.
4. Re: No proof by Anonymous Coward · 2013-10-26 02:42 · Score: 0
  
  The court wants people to show up at their trial. This is done through either collateral i.e. bail or just holding people in jail if they're more likely to flee than appear. Bail is supposed to be returned too.
5. Re:No proof by rmdingler · 2013-10-26 02:51 · Score: 1
  
  Given the track record of American law enforcement regarding seizures of assets "believed" to have been gained in unlawful transactions, I would say "Good Luck" fighting that. Further damaging his case, there is a link at the Forbes piece describing some (alleged) Mr. White-like tactics against an embezzler and a blackmailer.
  
  --
  Happiness in intelligent people is the rarest thing I know.
  Ernest Hemingway
6. Re:No proof by Anonymous Coward · 2013-10-26 02:51 · Score: 0
  
  The FBI doesn't care if the man is found guilty or innocent later on. They just want to bully, terrorize and disrupt the life of anybody who tries to mess with the established system.
7. Re:No proof by Anonymous Coward · 2013-10-26 03:21 · Score: 1
  
  The legal standards for asset forfeiture are not what you think they are.
  http://en.wikipedia.org/wiki/Asset_forfeiture
8. Re:No proof by Anonymous Coward · 2013-10-26 03:29 · Score: 0
  
  I bet you said the same thing to your mom when she caught you fapping on her keyboard. Didn't keep you out of trouble then, either.
  The short term safety of other innocent people, or of the good electronics from getting sticky, means a balance has to be struct to protect society and the fine Corinthian leather of your mom's new computer chair birthday present.
9. Re:No proof by loufoque · 2013-10-26 03:46 · Score: 0
  
  All this technology is anonymized. There is no tracking possible, it's just guesswork.
  This is not a normal bank account.
10. Re:No proof by Immerman · 2013-10-26 04:41 · Score: 4, Interesting
  
  No, not even a little. Have you studied the technology? It's all pseudonymous, which is a completely different thing. Anybody who wishes to can completely monitor all activity on any account, the only anonymity resides in how well you hide the connection between yourself and your account number. Publish your account number publicly, like any legitimate business would do to accept payments, and there is no anonymity whatsoever, and every transaction past and present with that account is now known to be a transaction with that business. If you want to be anonymous then the onus is completely on you to make sure a link between your account number and your real identity is never discovered, the technology offers nothing in that regard.
  Frankly, take away the gauze of anonymity and what you have is every financial analyst's wet dream of a currency - *every* transaction laid bare for all the world to see, in real time, and with a permanent record.
  
  --
  --- Most topics have many sides worth arguing, allow me to take one opposite you.
11. Re:No proof by ArbitraryName · 2013-10-26 05:26 · Score: 1
  
  http://bitcoin.org/en/you-need-to-know
  
  Bitcoin is not anonymous
  
  Some effort is required to protect your privacy with Bitcoin. All Bitcoin transactions are stored publicly and permanently on the network, which means anyone can see the balance and transactions of any Bitcoin address. However, the identity of the user behind an address remains unknown until information is revealed during a purchase or in other circumstances. This is one reason why Bitcoin addresses should only be used once. Always remember that it is your responsability to adopt good practices in order to protect your privacy.
12. Re:No proof by JesseMcDonald · 2013-10-26 07:43 · Score: 1
  
  Publish your account number publicly, like any legitimate business would do to accept payments...
  The recommendation is to use a different account for each order, not just for anonymity but so that you can distinguish the payments apart from the amount, which may not be unique, or even an exact match for the order in the event of a mistake. It's fairly rare even for "legitimate" businesses to have just one account number.
  Even apart from unique receiving addresses, any business dealing in large quantities of bitcoins will probably want separate "working funds" and offline "cold storage" accounts, and general practice is to generate a new address every time you send funds to receive the "change". Some consider this more secure against cryptoanalysis since the full public key isn't revealed until the funds are spent, meaning that if you do use a new address every time then the only addresses with known public keys contain no funds.
  
  --
  "The state is that great fiction by which everyone tries to live at the expense of everyone else." - Bastiat
13. Re:No proof by Anonymous Coward · 2013-10-26 08:32 · Score: 0
  
  Proof is not required to seize assets. Only a mere suspicion of criminal activity is required for a judge to sign off on a civil forfeiture. No criminal act need ever be proven, but even if there is, there is no requirement that the property seized actually be proved to have been involved in the crime.
14. Re:No proof by Immerman · 2013-10-26 13:43 · Score: 1
  
  That sounds like a lot of considerations and headache that are only relevant to people seeking to hide their account transactions. If someone were to go down and buy a TV at BitMart I'm pretty sure the sequence would be
  cashier: "you owe X bitcoins, please transfer to Account A"
  you: "okay, here it is coming from Account B"
  cashier (a half hour later after the transaction is confirmed): "thank you, come again."
  How on earth would involving several additional accounts in the transaction simplify anything? All you're doing is increasing the number of transaction fees that need to be paid (as that is the expected funding model as "mining" ceases to be profitable on it's own)
  
  --
  --- Most topics have many sides worth arguing, allow me to take one opposite you.
15. Re:No proof by JesseMcDonald · 2013-10-26 16:31 · Score: 1
  
  If you don't give each order a unique receiving address, you have no idea which incoming funds are meant to pay for which orders. You give the buyer an address to send funds to; they aren't expected to know which address(es) the funds come from. They just enter the receiving address and amount (or scan a QR code) and tap "send". Some of the smaller clients stick to a single address and private key, but most of them, including the official client, use randomly-generated "change" addresses which aren't shown by default in the UI. Any number of transactions to different addresses ("change" or otherwise) may be combined to fund a single transfer. This doesn't even consider web-wallets (like Coinbase) where the funds come from a shared address controlled by the service provider.
  In practice, every merchant accepting bitcoins today already uses unique receiving addresses. It's not nearly as much of a headache as you seem to think. For the buyer it's completely transparent, and for merchants the process is built into standard shopping-cart interfaces. It's all completely automated. (The real headache is processing refunds.)
  P.S. No one would hold a customer at a brick-and-mortar store waiting for confirmations; there's less risk of fraud once they've seen the transaction relayed to the network, even with zero confirmations, than there would be from normal credit card chargebacks up to several months later. If they're really concerned, they'll just require ID so that they can track you down later. It's not like you could get very far in 30 minutes anyway.
  
  --
  "The state is that great fiction by which everyone tries to live at the expense of everyone else." - Bastiat
16. Re:No proof by Anonymous Coward · 2013-10-27 05:11 · Score: 0
  
  Could those specific coins be turned into a "conflict diamond" so to speak, where individuals would choose not to accept any bitcoins if they were associated with a specific identity anywhere in the blockchain? A filter check prior to a transaction where an individual could set up a black list and refuse any of those targeted coins into their wallet?
17. Re:No proof by Immerman · 2013-10-28 01:07 · Score: 1
  
  Well, you could send them back, but I don't think there's currently any technical mechanism to be able to refuse to accept them, Giving your account bitcoins is a transaction between the sender and the network, you aren't actually involved at all except to provide the target account #.
  .
  
  --
  --- Most topics have many sides worth arguing, allow me to take one opposite you.
Dread Pirate Roberts by Razalhague · 2013-10-26 02:12 · Score: 4, Insightful

I wonder if this "Dread Pirate Roberts" is only one person, given how the name was used in The Princess Bride.
1. Re:Dread Pirate Roberts by bill_mcgonigle · 2013-10-26 03:10 · Score: 1
  
  He's at least the second - google should find you the longer version. Suffice it to say, the first DPR is retired and living like a king in Patagonia.
  
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2. Re:Dread Pirate Roberts by Opportunist · 2013-10-26 03:18 · Score: 1
  
  The should be glad he didn't call himself Spartacus.
  
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3. Re:Dread Pirate Roberts by spartacus_prime · 2013-10-26 08:10 · Score: 1
  
  I'm Spartacus?
  
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4. Re:Dread Pirate Roberts by Agent+ME · 2013-10-26 08:30 · Score: 1
  
  No, the person they caught was the one who originally advertised the Silk Road. Read the investigation documents. The story he told reporters about him being the second DPR and completely replacing the first are false.
A seizure or an Investment? by j-stroy · 2013-10-26 02:13 · Score: 2

Will the government then be auctioning off the proceeds? Holding them for cashing in later like a bond? Who is advising them on managing the funds? There is both a certain irony and legitimacy in a state holding this new stateless currency.
1. Re:A seizure or an Investment? by Austrian+Anarchy · 2013-10-26 02:30 · Score: 0
  
  Will the government then be auctioning off the proceeds? Holding them for cashing in later like a bond? Who is advising them on managing the funds? There is both a certain irony and legitimacy in a state holding this new stateless currency.
  It is a government agency, of course there are droves of people to advise, manage, and make every sort of decision on what to do with someone else's money.
  
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2. Re:A seizure or an Investment? by Anonymous Coward · 2013-10-26 02:42 · Score: 1
  
  They will hold them until the Bitcoins are worth enough to pay off the national debt.
3. Re:A seizure or an Investment? by TheP4st · 2013-10-26 02:45 · Score: 2
  
  It's a Government agency and being such it is heavily influenced by revolving door politics, so I can imagine that what will happen is that an external consulting company will be assigned with the task of managing the funds and will invoice them to the tune of 144,001 Bitcoins.
  
  --
  "I have downloaded hundreds and hundreds of records, why would I care if somebody downloads ours?" Robin Pecknold
4. Re:A seizure or an Investment? by slick7 · 2013-10-26 02:45 · Score: 2
  
  They will probably consider them spoils of the war on drugs. Then, they will use the concept in government transactions.
  
  --
  The mind conceives, the body achieves, the spirit manifests.
With a club by Anonymous Coward · 2013-10-26 02:16 · Score: 0

Or waterboarding?
Shaky shaky by lapm · 2013-10-26 02:18 · Score: 1

Sounds like feds are going to have uphill battle in court trying to prove all these beyond reasonable dought. After all in court its not what they say, but what they can actually prove. Lets just hope some innocent people docent come forward and claim those bitcoing to be stolen by feds from them... Would be embarrashing, not to mention blow feds case out of water...
1. Re:Shaky shaky by Anonymous Coward · 2013-10-26 03:10 · Score: 0
  
  Oh, I'm sure they won't have any problems. The days when the US government had to prove it's legal cases and do things in a legal manner are long gone. In fact if the FBI doesn't win this case I would count it more as a front to try to pretend that they can't win them all by default, because the amount of money here is negligible to the FBI, and they're really into this more for the notoriety of being able to pretend they're still relevant in a world where nobody cares about things like the drug war anymore.
2. Re:Shaky shaky by techno-vampire · 2013-10-26 07:16 · Score: 1
  
  Would be embarrashing, not to mention blow feds case out of water...
  
  Just because somebody comes forward with that claim doesn't mean that the jury's going to believe them. The defense would have to provide enough supporting evidence to show that there's a good chance that they're telling the truth, and the prosecution would have the chance to cross examine them and tear holes in their story. The important word in this is "reasonable." Just because somebody's willing to give you an alibi in court doesn't mean that you walk; you still have to make the jury think there's a good chance that the story's true.
  
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Only the CIA by Anonymous Coward · 2013-10-26 02:22 · Score: 0

are allowed to traffick drugs and currency. Shame on you, dude.
Was the FBI's seizure illegal? by Anonymous Coward · 2013-10-26 02:25 · Score: 0, Interesting

To move bitcoins you must spend money to transact them, about 2.5% is the transaction fee.
That's $625000 the FBI spent of that money, if not more.
Would that be illegal?
1. Re:Was the FBI's seizure illegal? by Anonymous Coward · 2013-10-26 03:55 · Score: 0
  
  You've never used Bitcoin before, have you? They could have transferred the money for free.
2. Re:Was the FBI's seizure illegal? by Anonymous Coward · 2013-10-26 05:08 · Score: 0
  
  They could have transferred all of those coins paying just a 0.0005 btc transaction fee. (so like 8 cents)
3. Re:Was the FBI's seizure illegal? by ArbitraryName · 2013-10-26 05:18 · Score: 1
  
  Nothing in your post is correct.
4. Re:Was the FBI's seizure illegal? by Anonymous Coward · 2013-10-26 05:33 · Score: 2, Informative
  
  Here is one of the transactions.
  You can see that the fee paid was 0.
  You can see their account here.
  Why speculate when the evidence is all public and easy to find?
Lessons from Ancient Anecdotes by Anonymous Coward · 2013-10-26 02:30 · Score: 0

Don't keep all your eggs in one basket...
so worthless currency? by Anonymous Coward · 2013-10-26 02:45 · Score: -1

so if fbi can "seize" your wallet and transfer out your theohretical dollars, how is bit-coin worth anything such that the fbi doesn't try to 'seize' everyone else's or anyone 'seize' any other credentials and transfer the funds to themself for that matter.
forensics by Anonymous Coward · 2013-10-26 02:57 · Score: 0

I guess this means that the FBI was able to recover the contents of RAM on Ulbricht's laptop after he was arrested. From what I understand, the FBI waited until they got confirmation from an informant that DPR was logged into Silk Road before they grabbed him and his laptop. They were careful to separate the laptop from Ulbricht before he reealized he was being busted and could shut-down/wipe-keys and frustrate efforts to recover evidence and his booty.
Do you think they carefully disassembled the laptop while it was on and chilled the memory with LN2 before removing the modules and placing them into a hardware duplication device or do you think they just slapped in a USB doohickey that ran some code to copy the memory?
1. Re:forensics by Anonymous Coward · 2013-10-26 04:01 · Score: 0
  
  I bet they used a wrench to the knee.
2. Re:forensics by ArbitraryName · 2013-10-26 05:20 · Score: 1
  
  They probably just put him in an interrogation room and talked about Federal prison until he cried and gave up his passwords.
It's his. Because we say so. by Opportunist · 2013-10-26 03:17 · Score: 1

If that kind of "evidence" holds a drop in water in court, good night legal system.

--
We used to have a Bill of Rights. Now, with the rights gone, all we have left is the bill.
1. Re:It's his. Because we say so. by Urkki · 2013-10-26 07:08 · Score: 1
  
  If that kind of "evidence" holds a drop in water in court, good night legal system.
  If they seized that amount in dollars from inside his mattress and transferred the cash to FBI custody, how much proving would they have to do? What would happen to the money?
  After answering that, how is seizing bitcoin wallet from inside his computer and transferring the coins to FBI custody any different?
2. Re:It's his. Because we say so. by Agent+ME · 2013-10-26 08:31 · Score: 1
  
  If it came from his computer, ... I can't imagine in what reality that wouldn't hold a lot of water in court.
3. Re:It's his. Because we say so. by Opportunist · 2013-10-27 00:16 · Score: 1
  
  I've been long enough in IT security to no longer believe that simply because something is on someone's computer or because some data originated from someone's computer that it actually has something to do with that someone. Computers are far harder to secure, far easier to break into and such a break in far harder to notice than your average home would be, especially considering the recent discoveries how "your" system is not necessarily "yours" at all.
  
  --
  We used to have a Bill of Rights. Now, with the rights gone, all we have left is the bill.
4. Re:It's his. Because we say so. by Anonymous Coward · 2013-10-27 00:23 · Score: 0
  
  You may be right in general, but in this case...
  "Halp! Somebody planted a Bitcoin wallet on my PC and didn't even encrypt the private key allowing FBI to transfer all the assets from it!"
5. Re:It's his. Because we say so. by Urkki · 2013-10-27 18:35 · Score: 1
  
  I've been long enough in IT security to no longer believe that simply because something is on someone's computer or because some data originated from someone's computer that it actually has something to do with that someone. Computers are far harder to secure, far easier to break into and such a break in far harder to notice than your average home would be, especially considering the recent discoveries how "your" system is not necessarily "yours" at all.
  But about the same can be said about cash found in a mattress. It' quite possible it was put there in a factory already as a part of mob money transfer scheme (and somebody got their kneecaps removed, because it was lost), or perhaps a fugitive broke in and hid the booty there (and was then caught or killed and never came to get it, lucky you), or perhaps it simply belongs to the Significant Other, who is secretly running an entirely different illegal business, completely unrelated to the first case.
  All of these are unlikely, but I think they are still at least as plausible, as having an unencrypted bitcoin walled with that much money in a "zombie" host.
So, what if... by Anonymous Coward · 2013-10-26 03:22 · Score: 0

If someone could overtake 51% of the Bitcoin mining, they could change the blockchain. What if 51% of the Miners agree that the FBI shouldn't have that money?
1. Re:So, what if... by Anonymous Coward · 2013-10-26 03:55 · Score: 0
  
  Difficulty just jumped to 400m in the last 24 hrs, and 150% just in the last 2 weeks.
  Yeah, your post makes a lot of fucking sense. Numbnuts.
2. Re:So, what if... by Anonymous Coward · 2013-10-26 04:20 · Score: 0
  
  First, there is a problem of talking all the people into doing that.
  Second, there is a problem of actually doing that - you'd basically have to throw away all the transactions since FBI started transferring funds to its own wallet and redo all the blocks again until this moment again, without FBI's transfers.
  And lastly, there is a problem that once you agreed that FBI shouldn't have that money, who would trust the Bitcoin network not to decide next that Winklewoss bros. are out to game the BtC system and shouldn't have their money, or that MtGox have too much influence on BtC price and shouldn't have the money, or that OP is a fag and shouldn't have his money? That slope's slippery. Either BitCoin is open, controlled by nobody and miners only impartially process transactions they're given, or every your transaction is potentially a hostage to the whims of BTCGuild and GHash.IO.
3. Re:So, what if... by Agent+ME · 2013-10-26 08:35 · Score: 1
  
  Ignoring the logistics of actually doing that (which would affect many more transactions than just that), you'd have to convince 51% of miners that the loss of confidence in the Bitcoin system that would result from that network meddling would be worth it. A 51% attack on Bitcoin for any reason would destroy a lot of confidence in the system. The price of bitcoins would plummet. Good luck convincing miners, who profit from the price of bitcoins, to ever do that. Also, not everyone who uses or mines Bitcoin is a big fan of the Silk Road.
GOVERNMENT SELLING SEIZED BITCOINS by rawtatoor · 2013-10-26 04:24 · Score: 1

This would be fraudulent for the body that is supposedly responsible for the money. They would be tainting the US Dollar in a real way that wouldn't go unnoticed.
eggs in one basket by Anonymous Coward · 2013-10-26 04:30 · Score: 0

call me paranoid but i use multiple wallets and addresses. I have two private keys (paper wallets) that are not loaded into an online wallet or another client.
i also create multiple backups every 24 hours of my encrypted wallet.dat in blockchain.info files.
1. Re:eggs in one basket by ArbitraryName · 2013-10-26 05:52 · Score: 1
  
  Great. How long will you last under interrogation?
DEA & FBI by Anonymous Coward · 2013-10-26 05:03 · Score: 0

would do a service to US and human society in general if they spent the money on education and eradicating poverty instead of fighting drug wars that are lost already. Fuck NSA FBI anf DEA! Funny how the land of the free degenerated into a police state.
Worth $28 million? No. by Anonymous Coward · 2013-10-26 05:16 · Score: 0

Why is the FBI so incompetant to think they are worth $28 million? You can't compute the actual amount of USD you'd get by lastprice x number of bitcoins. You need to look at the order book. On #bitcoin, I've asked gribble. So if you sold 144,000 bitcoins, you'd get about $14 million USD and send the price of bitcoin to around $23/bitcoin.
1. Re:Worth $28 million? No. by Anonymous Coward · 2013-10-26 05:21 · Score: 2, Funny
  
  Because FBI thinks they seized 144000 BTC, not $28mln or $14mln. USD numbers are claimed as a fact by PR people and news outlets to make good headlines.
  PS: It's spelt "incompetent", you moran.
There's not even a wrench? by Sits · 2013-10-26 05:42 · Score: 1

Obligitory XKCD 538 link.
Already sold by dgenr8 · 2013-10-26 05:51 · Score: 1

Just like last time, the market moves over the last few days strongly suggest that the FBI is already selling, or has already sold these bitcoins into the market.
1. Re:Already sold by Anonymous Coward · 2013-10-26 07:32 · Score: 0
  
  No, you can see they are sitting at that address unmoved. When they move, everyone will know it. You gon't have to guess.
  https://blockchain.info/address/1FfmbHfnpaZjKFvyi1okTjJJusN455paPH
2. Re:Already sold by Anonymous Coward · 2013-10-26 08:17 · Score: 0
  
  You would be able to tell that by examining the blockchain.
3. Re:Already sold by Agent+ME · 2013-10-26 08:38 · Score: 1
  
  The price was just in another bubble after rapdily rising recently, and is cooling off again. Nothing about the recent price movements was very unusual to support an explanation like that. (Also, as another person linked, you can see that the confiscated bitcoins are all sitting still in a certain address.)
Please sell them by Anonymous Coward · 2013-10-26 06:04 · Score: 0

Bitcoins are not for government, please sell them and collect your $28.5 million!
3 BTC community.
Re:Not Already Sold by DanielRavenNest · 2013-10-26 07:48 · Score: 1

As the link in the summary shows: https://blockchain.info/address/1FfmbHfnpaZjKFvyi1okTjJJusN455paPH
The bitcoins are still in the FBI seizure account. Not only that, entrepreneurs are sending small amounts to the account, with advertising attached, for online casinos, or cursing out the FBI. I find that amusing. If you scroll down past the tiny (0.0001 BTC) transactions, you will see the big transfers in for 324 BTC at a time. On a phone that spells out "FBI", so that is pretty clear who is doing the transfers.
Just Sayin' by Anonymous Coward · 2013-10-26 08:24 · Score: 0

...nor be deprived of life, liberty, or property, without due process of law...
Oh nevermind. We all know that no longer applies in the US.
Small change by Anonymous Coward · 2013-10-26 09:28 · Score: 0

This is probably the small change! The Big Money is safe from the Feds... Hahaha
Re:Not Already Sold by dgenr8 · 2013-10-26 10:18 · Score: 1

Unless the FBI cares to prove it, nobody knows who controls the receiving address. It could easily be someone who paid for the coins.
For example, an exchange who then sold an offsetting amount from other controlled addresses.
And? by Anonymous Coward · 2013-10-26 13:01 · Score: 0

The Bitcoins will be use to fund illegal narcotics and sex slaves from China to Obama!
'Nough said!
Stolen monies by sharknado · 2013-10-26 16:54 · Score: 1

Where does all the money go that the government takes from seizures? I've always wondered.
What FBI actually stands for by thexile · 2013-10-26 19:38 · Score: 0

Federal Bitcoin Institute.
Refuse Receipt? by IdeaMan · 2013-10-28 08:41 · Score: 1

Is it possible to refuse to accept any bitcoins that were seized? If so then management becomes like the spam blocking lists.

--
They ARE out to get you simply because They are in it for themselves and they don't care about you.