Most of the business there was drugs, obviously, but some amount of that money would have bought legitimate items. So what gives them the right to sell off that money?
Users sent bitcoins to SR to hold for them, in return for a promise to return them on demand. So SR's assets and liabilities both increased with each deposit. Then USG seized SR's assets (under what right? That SR was an illegal enterprise established to facilitate narcotics sales). SR still has liabilities to its users, but now it can't meet them. Note that SR's liabilities are no concern of USG.
Come on guys, is it so hard to understand that if you exchange an asset for a security, you don't own the asset anymore?
> Come on guys, is it so hard to understand that if you exchange an asset for a security, you don't own the asset anymore?
In this case this fact is directly contrary to a worldview held by many at HN, so I suspect everyone pointing out how property law actually works is in for a long slog.
Also, if I understand it correctly, many of those coins were not preallocated to any sale. They were just sitting there to be used in the future. So whether they would be used for drugs or something legal is irrelevant.
Imagine you hand your local crack dealer a wad of cash to hold for you temporarily. The crack dealer adds it to his bigger wad of cash and promptly gets busted. The drugs and money he's holding are seized. That's what happened here. Would you expect the government to return your wad of cash?
Then you should've filed a claim with the court after:
1) the government filed "US v. A Wad of Cash Found in the Pocket of Danny Drugdealer"
2) the wad of cash was found to be subject to forfeiture
3) Danny Drugdealer didn't contest that he was innocent of drug dealin' or he attempted to and lost
4) The government posted that the wad of cash was subject to forfeiture at www.forfeiture.gov.
You'd then be entitled to make the case that ten dollars in Danny Drugdealer's wad of cash actually belonged to you and were not subject to forfeiture. You might've even won!
No one filed a claim to block forfeiture of all or part of the Silk Road bitcoins. Not even DPR. I think everyone knows why that is.
They did it because they had the capability. Civil forfeiture is an absolute perversion of the justice system, and is a direct contributor to police corruption. The damage it causes to the integrity of our rule of law is far greater than any deterrent effect it may have upon crimes.
Most of the business there was drugs, obviously, but some amount of that money would have bought legitimate items. So what gives them the right to sell off that money?