Submitted by Wendals87 t3_ypkcsg in todayilearned
Reply to comment by dnap123 in TIL: That in 2019, some criminals were caught and 36 BTC was confiscated. The authorities valued the worth at €127,000 at the time and was sold 2 years later for €1.5 million. The criminals were returned €1.3 million due to the fact that the amount was expressed in Swedish Krona, not BTC by Wendals87
Think of it this way: the police say you stole $100,000. When they raid your home, they seize a bar of gold. The court orders you to repay the $100,000. To make this happen, the police sell your seized gold bar, which fetches $1,000,000. Logically you get the remaining $900,000 back.
That's what happened in this case - the police said a certain cash value (not a particular number of bitcoin) were criminal gains. They sold the seized bitcoin to recover the ill-gotten funds, which resulted in far more cash value than they were ordered to repay. As such, the remaining balance legally had to be returned.
The part where I'm confused is why does it go to the criminals and not the people who were stolen from?
Because the people lost the 127k. They got that back. The criminals got refunded the remaining 1.3 million.
The original BTC owners would now have to litigate the criminals to argue that the criminals profited from illegally holding onto BTC that wasn't theirs, but that would likely be a civil case.
Interesting to see how that would work out.
Edit: I see it was proceeds of drug trafficking that was being held in BTC, so there are no "prior owners" in that sense of the word. Still - lesson learned for the Swedish po-po.
The problem is it's highly unlikely they actually stole bitcoin directly. It's much more likely they stole money through wire transfers/credit cards/etc. and routed it through a bitcoin exchange so the transaction couldn't be reversed.
Could well be.
Like I said - it'd be an interesting legal case to follow.
But isn't one of the basic ideas of forfeiture that you lose the thing seized in its entirety, lose any and all interest, including any future profits? I imagine that in most other places, once the authorities take it from you, it's gone.
To what point though? Say a criminal steals $50,000 and creates a successful business with it worth millions or maybe even billions. Does the criminal lose all rights and profits to the business? It is not just money that requires a business to be successful.
The victims involuntarily had their money invested in bitcoin, they could argue that in this sense they should have the equivalent share of the ROI.
No. Nothing was stolen. There were no original bitcoin owners. The bitcoin was drug proceeds.
Crime really does pay
But they didn’t lose 127k; they lost 36 BTC.
Did they? So if BTC had dropped to $10 instead of going up, would you say those people had only lost $360, even though it was 127k when it was stolen?
How about the fact that it's highly unlikely the money was stolen as bitcoin, but was far more likely to have been stolen directly out of normal accounts and converted into bitcoin? So if I steal $10,000 from your bank and use it to buy a car, did I steal your money, or did I steal your car?
The whole point seems to be that the prosecutors specified the amount stolen in the equivalent in fiat (Krona) at the time, rather than saying 36 BTC, leading to this situation.
So, the criminals had to give back the amount specified in fiat, even though BTC had increased in value in the meantime.
Not necessarily.
The criminals stole 127k in fiat from the victims. The cops did not seize 127k in currency, but they did find 36 BTC and took that when arresting the criminals.
They then sold the 36 BTC to collect the 127k in fiat. They returned the 127k to the victims. They returned the remaining 1.3 million in fiat to the criminals because they could not prove the rest if the money was criminally obtained.
It would be like if you had to foreclose on your 30 year mortgage after paying into it for 10 years. The bank would sell your house and (assuming the house was sold for around what you bought it for) the bank would take about 2/3rds of the sale price and you would get the other 1/3rd back (without complicated contractual agreements).
Where are you reading they stole the money? The gained the money through online sale of drugs. As far as I can see in there was not victim of theft.
Because the police couldn't prove they stole the rest of the money or they didn't steal it, so why should they lose that?
There was no theft, it was drug money from online sales.
Because it was valued for 127k. It just happened to sell for more.
This law wasn't exactly made with things that fluctuates in value as rapidly as bitcoin is.
Now, the question I would have though is if they sold the gold bar for $50k, would you then still owe fifty more?
Yes. If the court ruled you owed $100k, you would be liable for the remaining 50k.
Steal 'your' stuff, sell it without permission to whomever they please without shopping around for the best price, then keep you on the hook for an additional costs due to their laziness.
Yep, sounds like government to me.
Yes, for example even they sell your $20,000 car for $1 to their cousin (like in Chicago), you still have to pay the parking fines and tow fees and your auto loan.
Yep. Had this seizure happened in 2020, and then the sale happened today, this case would be reversed with the criminals owing way more than the bitcoin was sold for.
Your 2nd paragraph is correct, but the 1st paragraph doesn't explain it properly. The gold in your example didn't increase in value, and the authorities simply confiscated too much. In reality, the correct amount was confiscated, but the increase in value wasn't taken into consideration, because of how the value was expressed.
Except the gold could have increased in value that much - it's unlikely, but a combination of factors could have lead to a massive increase in value.
And while the BTC did go up, it could have just as easily went down. So if the value had gone to, say, 1/10 the people who lost 127k should have only been allowed to recover 12.7k instead?
Plus you're making the assumption that they even stole BTC from people directly. It's much more likely these were cash transfers from bank accounts or credit cards that the criminals routed through bitcoin exchanges.
This is all true, just wasn't expressed in the previous 1st paragraph.
More like "you sell drugs for gold, which then gets confiscated by the police".
If they stole the BTC, the coins would (should) have been returned to the victims.
I thought in America they just take your money and weather or not you’re proven innocent they keep it all for themselves.
No, I would say most people don't say you logically get the overhead back after stealing something lol. That's why it's a TIL, because it's frankly mildly absurd.
But you can't seize BTC unless the criminals freely gave over their keys.
Or had their keys on something else that was seized. If you've got your keys stored on your computer, and they seize the computer, then they've got your bitcoin.
So? Its possible the police or court ordered them to hand over the keys and they complied as part of the legal proceedings.
Yea... But I'm not sure the word seize applies in that case.
If you are compelled to surrender something to authorities as part of a legal proceeding, that’s a seizure. They don’t necessarily have to literally take it by force or against your will.
Ok but what happens when they confiscate wallets, PCs, or hard drives?
Your fake internet currency has physical evidence. If the feds want it, they'll get it lol.
I mean.. typically it's encrypted on any hardware. If someone has plaintext keys on their hard drive something has gone seriously wrong
Yup, means the feds came knocking 🤞. You've been lied to if you truly believe they can't get ahold of it if they want.
That's simply false. If you don't give up your keys they can't be forcibly taken from you.
So when the subpoena comes, you're telling the feds to fuck off? Straight to prison? Okay.
As I said. If the feds want it, they'll get it. If its not the money, it's your freedom.
Yes exactly. I can choose prison. That is not true with dollars. The feds want your dollars they can reach into your bank without your permission. With BTC the feds can't force it, even if they are willing to go as far as killing you.
Exactly. So you're going to prison or getting killed by the federal government before giving up your fake internet money? OK, Chad.
You guys are ridiculous lol. Don't you have an NFT scam you could be falling for right now?
Why do you hate so much? Why does it bother you?
I don't really care that you don't seem to like BTC.
They can't. Even the feds are subject to the rules of mathematics, and that's how pgp keys work. There are cases out there where proper opsec has kept people out of jail.
If the feds decrypted his shit, they got his keys somehow. Either he turned them over or, and this is shockingly common, had them written down or on the device unencrypted.
Oh hey, congrats on overexplaining my comment for no reason 👍
> If the feds decrypted his shit, they got his keys somehow. Either he turned them over
When the feds bring the subpoena, you have two choices. Comply or face the music. If they want it, they'll get it. Your money or your freedom. Hence why I said "when the feds come knocking".
No, I was replying to the "if they want it, they'll get it" part of your comment. Up those reading comprehension skills👍🏽.
They will NOT get it, no matter how badly they want it, without the key. And you can hide your key. That's the third choice when the feds show up: don't have the key where they can find it.
Get "it", means what they want. You going to prison to protect your subpoenad fake internet currency?
I'm sure there's some shitcoin you could go lose money "investing" in. Surely. Go do that instead of bothering me with missing the point. You crypto dorks are ridiculous lol. There's an NFT of a lizard with your name all over it.
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No wonder ancaps love BTC so much
It doesn't have to be freely. A court order is usually backed by you sitting in jail until you cooperate.
Ok but then they still get a choice. If, for example, I was told to pay in dollars the gov can reach in my bank and take it. I wouldn't get an option up go to jail and not pay.
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