back to article Feds to flog off $28m in Bitcoin from Silk Road drug souk seizure

American officials are preparing to sell off $28m worth of Bitcoin which was seized during the operation to shut down the Silk Road online drugs market last year. In a statement, US prosecutor Preet Bharara announced the forfeiture of 29,655 Bitcoins. She said: "With today’s forfeiture of $28m worth of Bitcoins from the Silk …

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Been suggested before

Dump enough Bitcoins into the market, their price tumbles, criminals don't have enough money any more.

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Re: Been suggested before

RE:"Dump enough Bitcoins into the market, their price tumbles, criminals don't have enough money any more."

This is a situation in which your competition could destroy you overnight, simply by being there. What if there were more than one Bitcoin system that plans to issue a like amount of currency? What if there were two more such operations? How about three more? Getting the picture yet? Meanwhile, back at the lab, the crypto-boffins are busily increasing the complexity of this alleged crypto-currency.

http://blog.cryptographyengineering.com/2013/04/zerocoin-making-bitcoin-anonymous.html

Like Mister Scott said, "The more complicated they make tha plumbin', the easier it is to overtake the drain."

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Great news everyone

Hope this will be sold on public exchanges not auctioned off privately, if the price goes down, it means we can buy in cheap!

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I wonder if the NSA could devote some of their encryption/password cracking resources to bitcoin mining, and thereby create their own sort of budgetary moneylaundering?

I'd add the joke icon, but... *shudder* it wouldn't surprise me at all if it was actually already in progress, like some perversion of Rule 34.

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Has he been convicted yet?

Are the Bitcoins actually his? Can the FBI legally sell them before a conviction?

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Re: Has he been convicted yet?

Those aren't his bitcoins. These bitcoins are the property of The Silk Road (mainly liquid bitcoins, so bitcoins of pending sales and general stuff to handle server costs. So not the private stash of DPR or Ulbricht.

Thus they can be legally sold without convicting him of any crimes.

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Re: Has he been convicted yet?

d3rrial, how do you know that?

Aren't the trials pending?

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Re: Has he been convicted yet?

How do we know that these aren't his bitcoins? The article says so.

"In a statement, US prosecutor Preet Bharara announced the forfeiture of 29,655 Bitcoins."

"He is contesting the forfeiture of the 144,336 Bitcoins seized from his computer after claiming he legitimately owns them. These are now worth about $130m."

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The beginning of the end

Large sale drives down price... panics speculators... rest is history

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Re: The beginning of the end

Except that here speculators know what is causing the price drop and will jump at the lump of meat like sharktopusses with bearclaws.

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Re: sharktopusses with bearclaws

That's gotta hurt !

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Anonymous Coward

Re: sharktopusses with bearclaws

And the feds will of course, not investigate the buyers in case one of them may be a criminal enterprise or money laundering run?

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Re: The beginning of the end

OR... US government selling bitcoins gives implicit signal that they are legal to own, and anyone buying bitcoins from the government would have good standing to sue if they were restricted or outlawed in future. Price spikes. The end of the beginning.

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Anonymous Coward

I had bit coins on the Silk Road. They weren't the proceeds of crime, I had bought them legitimately and just had got around to spending them. I wonder if the FBI would give me them back? They're worth a lot more now than when I bought them!

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This is just the first barrage aimed at the Bitcoin system.

The Feds will not stop until there is not Bitcoin system. Why? Because Big Banking does not like competition from anonymous sources that it cannot control. Down that road lies their ruin. I would feel much better if someone would start making coins out of 31 grams of bell metal. That way, what you have is what you can be counted, stored and even spent.

The US dollar along with all the other debt based currencies are about to fall to pieces. Don't believe that the US dollar is based on debt? Just read a dollar bill. What it will say is that it is a "Federal Reserve Note." Notes are nothing more than transferrable debt. The United States borrows its currency from a creature called "The Federal Reserve Bank." Despite its name, it is an entirely private company. True, the ties between the Federal Reserve Bank and the government are intimate, but the Federal Reserve Bank runs the show to suit itself. All of our politicians bow to its will as though it were God.

Tricky Dick was a slipperly little prick. He managed to screw all of us despite his being impeached over Watergate. He did that by closing the gold window at the Federal Reserve Bank. I wonder whether he fully appreciated the enormity of what he did to us? Probably not.

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Re: Big Banking does not like competition

What makes you think that BTC is competition for Big Banking ?

They deal in a hundred different currencies all day long, one more is not going to be a problem.

BTC is anonymous and not beholden to the banking system, you say ? Then why is there a conversion rate ? Who do you think tracks the conversion rate and updates it ? Where do you think the conversion rate is logged and analyzed ?

Big Banking already has its claws in BTC, like a remora on a shark. Big Banking doesn't care what makes a currency, it already doesn't make the currencies that flow through it. Big Banking just wants to ensure that ALL currency flows go through it.

So dollars, euros, drachmes, bitcoins, it's all the same for Big Banking. BTC can go on being "anonymous", a dollar bill is anonymous too.

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Anonymous Coward

Re: Big Banking does not like competition

"BTC can go on being "anonymous", a dollar bill is anonymous too"

An electronic dollar bill isn't anonymous - there are strict regulations and controls on every transfer making it so.

With BTC you can have a much higher degree of anonymity...And due to the whole nature of BTC it is much harder to set up those sort of conventional controls in the future...

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Re: This is just the first barrage aimed at the Bitcoin system.

This is not aimed at Bitcoin. It's aimed at illegal uses of Bitcoin. These coins are being treated no different to any other asset of a criminal enterprise. They're probably auctioning the server hardware too.

The Feds like Bitcoin. Check out the Senate hearing. They can see the benefits as well as anyone.

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