This will not effect bitcoin in the long term.
"Truly innovative business models don't need to resort to old-fashioned law-breaking, and when Bitcoins, like any traditional currency, are laundered and used to fuel criminal activity, law enforcement has no choice but to act."
Personal opinions on the war on drugs aside, he left himself open for this. Allegedly he knowingly facilitated transactions in an effort to launder money, regardless of the currency. During court the evidence will show whether this is a true allegation or just a smear campaign.
There is no surprise that the US government would aim to arrest those who helped facilitate the silk road, none.
As far as the double standard with banking goes, it IS bullshit, but bears no weight on this specific case. I'm sure HSBC spent a lot of time, money and effort to cover their ass, and Shrem will probably cooperate and facilitate a further investigation and get out with hefty fines, a very brief all expensive paid vacation to upstate new york, and a smeared reputation.
But the bright side, if the government holds a decent amount of bitcoin, will they not protect their investment? Maybe that's just the optimist in me.
