Topic: Asset Recovery and Bitcoin (Read 1161 times)

The Courts can always say -"Another 20 years in prison to the fraudster, if he doesn't hand over his wallet".
Now it is up to the fraudster - Does he value his bitcoins more or does he value his freedom?

If you would use a password generator that generates the same level of entropy as a private key then you might as well memorize the private key as your password (unless you use some kind of password storage program - like keychain - to store the password, in which case the password to this program would have the same issue.

Actually we need the one who will change the laws lol

Laws will change.

Since the courts can no longer just whip the funds away people will be sent to prison until they cough up their private key.

It is good in two ways;-

1. If it is justified, it wont take too many "shower scenes" until the funds are returned.

2. If it is unjustified all hell will break out, it will be the new form of civil disobedience and the press will love it and people will listen.

Due diligence should pay off under this senario

The issue isn't fraud from a Bitcoin transaction. Rather, it's using Bitcoin technology to hide the proceeds of an underlying fraud or theft (e.g., insider trading, cheque kiting, etc.), so as to deny the plaintiff recovery—in the same way that you would stash a pile of stolen money in a cave that only you knew about. How close is Bitcoin technology to this cave analogy? Or is there something about the tech that gives a plaintiff a fighting chance of recovering their money?

Says who? You can always use long password generators.

If the government is able to get a copy of your encrypted wallet file then your bitcoin are not secure. An attacker would have an unlimited number of attempts to try to "guess' your password, and would likely attempt to "hash" the wallet file until they figure out the password. An attacker the size of the government would likely have a lot of resources (hashpower) to carry out this attack.

Any password to your wallet will have much less entropy then your private keys and will only delay an attacker from getting access to your bitcoin (giving you time to move your bitcoin in the event that you know your encrypted wallet file is compromised)

I don't think it is possible. The blockchain technology secured the bitcoins with specific private key. Doing any transactions with bitcoins, you have to use associated private key to authorize them.

Private keys held on blockchain.info are only stored in encrypted form and blockchain.info does not actually have access to the private keys (nor the addresses stored on each wallet). The generation, encryption and decryption of private keys are all done on the client/browser side (on your computer).

It would be impossible for the court to seize your bitcoin in similar ways they seize a bank account, however it can use other means to convince you to give up the bitcoin (mainly by using the threat of jail or actually putting you in jail until you give up the keys)

edit
sorry posted in wrong topic. i was talking about a topic discussing where a victim whom wanted funds returned if they got scammed by making the bitcoin protocol DE-fungiable

instead of compromising security by allowing others to freeze/redistribute coins.. do the most simple thing..

remember this sentance
"if i do not know enough about this person to walk upto him and slap him across the face with a wet fish... DO NOT hand him funds"

so here's a philosophy to follow
1. if you have an amount of money. would you simply hand it to a cousin/distant relative to look after. if no, then DONT give it to strangers
2. if you have an amount of money. would you simply hand it to a stranger that starts a convo with you on the street. if no, then DONT do it on the net
3. if you have an amount of money. would you bother chasing them with a wet fish if they wrong you? if no. then dont hand them money

This power of the court is often abused. I had a bank account with about $800 wrongfully garnished once. About 2 weeks later, after a hearing, the judge returned the money. However, in this time, the overdrafts and fines by merchants actually exceeded that original $800. Basically, the collateral damage exceeded the original damage.


Not if it has been properly secured.


The most secure online wallets do not hold your public key. They hold a data file that can be decrypted with your password. They do not have a copy of this password as that would make your private key susceptible to any hacker. They might be able to freeze your online account, but if you have a backup, you could just import your private key to another wallet. I actually did this when blockchain.info was not working for a couple days and needed access to some btc. I just downloaded electrum and imported one of my private keys.


If the wallet is not properly secured, then yes. It appears that Ross Ulbricht did not secure his bitcoin wallet sufficiently. The FBI were able to confiscate his bitcoins when they arrested him and got his laptop. Then again, they may only have confiscated the bitcoins associated with silk road. He might have a separate stash elsewhere that hasn't been touched.



No, the private key is used to encrypt the transaction. The transaction is then sent over the network. It must match the public key located on the blockchain. The private key is not normally sent over the internet, although online wallets often have weaknesses associated with this.


They can't if it is properly secured.

In a world full of corrupt power hungry governments, Bitcoin returns power over money back to the people.

Hi,

Assume a fraudster parks his ill-gotten gains in a bank account. As part of fraud recovery proceedings, the court can issue a freezing order to freeze the fraudster's assets. In compliance with the order, the fraudster's bank will not allow any funds to be withdrawn from the impugned account.

What recourse is there if the fraudster parks his money in a Bitcoin wallet? Is there any way to obtain access to the BTC wallet, outside of the fraudster voluntarily giving up his public/private keys?

What if the fraudster uses an online wallet (e.g., blockchain.info)? If I understand correctly, in such cases, online wallets (i.e., public and private keys) are held by a third party (e.g., blockchain.info). Could such third parties be compelled to comply with a freezing or seizure order to hand over the keys? Or could their servers be searched to retrieve the keys?

Assuming the fraudster hosts (?) his own BTC wallet. Would seizing his physical hard drive give authorities access to public and private keys, and therefore his wallet?

Assuming the public/private keys cannot be found (i.e., either the fraudster will not cooperate or the keys cannot be recovered from his hard drive, his diary, etc.). Can authorities obtain the public/private keys by issuing subpoena to the ISP? Or through packet sniffing?

Basically, how can authorities get their hands on a fraudster's Bitcoin wallet, outside of the fraudster's cooperation?