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Bitcoin 1 - 0 FBI

Tyler Durden's picture




 

Submitted by Pater Tenebrarum via Acting-Man blog,

The Dread Pirate's Cash Stash is Still Safe

As a quick addendum to our recent post on the Silk Road bust and what it means for bitcoin (surprisingly little), here is something that strikes us as truly funny. Apparently the FBI finds itself unable to confiscate the Dread Pirate's stash of bitcoins:

“Closing down the Silk Road and arresting its alleged operator has left the FBI in uncharted territory. After shuttering the hidden site, law enforcement went to work confiscating the money and materials belonging to supposed drug kingpin Ross Ulbricht, but this usually routine procedure is proving especially troublesome in this case. The cache of more than 600,000 bitcoins in Ulbricht’s personal fortune are still inaccessible to the FBI. The only way to move Bitcoins out of a private wallet is to have the corresponding private key to authorize the transaction. The FBI has been unable to get through the encryption protecting Ulbricht’s wallet, leaving all those Bitcoins — amounting to roughly $80 million at current rates — out of reach. Based on publicly available data, this is about 5% of all Bitcoins in existence right now.

 

Funds held by users of the site, however, were not so well-protected. Before completing transactions on the Silk Road, users would load Bitcoins into an escrow account on the site. The agreed upon coins would only be transferred to the seller’s private wallet once the buyer had verified delivery of the goods. When the feds took over the Silk Road, there were over 26,000 Bitcoins in user accounts that were relatively easy to snatch up.

 

The FBI has transferred all 26,000-plus seized Bitcoins to its own personal wallet, but because Bitcoin transactions are tracked publicly, it didn’t take the internet long to find the FBI’s wallet address. Users have taken to transferring tiny fractions of a Bitcoin to the FBI with public comments attached decrying the war on drugs and the arrest of Ulbricht. Users have even helpfully tagged the wallet address as “Silkroad Seized Coins.” You can check out the comments as they come in by watching the blockchain for the FBI’s wallet.”

 

(emphasis added)

In other words, one of bitcoin's main attraction – that it is untraceable like cash and cannot be 'stolen' in the conventional sense by outsiders  – remains in perfectly fine fettle. The FBI's inability to seize the Dread Pirate's bitcoin stash is a great PR victory for bitcoin.

As to users inundating the FBI's bitcoin wallet with protests against the drug war, this is an additional irony. Since it is not possible to identify them, they need not fear any reprisals, which is giving them an excellent opportunity to vent their opinion on the senseless 'drug war'. That isn't going to change anything, but we suspect that even within the FBI there are by now many people who are questioning whether the 'war on drugs' makes any sense. As noted previously, after more than 30 years, it has yet to attain a single one of its purported official objectives. That leaves basically only one possibility if one employs Occam's razor in pondering the question why it is continued: the official objectives are not the true objectives. There is a hidden agenda.

 

Pecunia Non Olet

The authorities have seized Ulbricht's bitcoin 'wallet' – but this is not sufficient to take control of the funds:

“While authorities have control of Ulbricht’s wallet, that’s not the same as having the funds. It’s akin to seizing a computer from a suspect with valuable data inside, but being unable to access it because strong encryption was used to prevent access. Ulbricht himself surely has the necessary information to unlock his wallet — otherwise there would be little use in accumulating $80 million worth of Bitcoins. It’s possible prosecutors will use the leverage they have on him to work out a deal that includes turning over the encryption keys.”

If Ulbricht is betting on government's greed providing him with a little bit of leverage in negotiations, he is probably correct. It gets even funnier though – the government doesn't recognize bitcoins as 'money' – but that won't keep it from spending this 'non-money'. As the author notes, the essentially bankrupt government no doubt can use the cash infusion:

“The government doesn’t even want to recognize Bitcoins as money, but that apparently won’t stop it from spending them. In these dark days of government shutdowns and sequestration, Uncle Sam could use the infusion of cash. The Bitcoins taken as part of the Silk Road operation will be held until legal proceedings have finished, then they will be liquidated, according to an FBI spokesperson. Users who are out those 26,000 BTC are unlikely to be seeing them again. Even if Ulbricht avoids spending the remainder of his days in prison, his $80 million fortune probably won’t be waiting for him.”

(emphasis added)

They will throw the book at Ulbricht, so it is highly doubtful he will ever leave prison again. Of course it cannot be categorically ruled out that drug laws will change one day and some drug-related sentences will then be altered retroactively. Anyway, bitcoin's reputation as a safe and anonymous form of money remains intact and may even be enhanced in the wake of the Silk Road bust. As to Uncle Sam, he is simply acting according to the ages old maxim:

Pecunia non olet”.

 

Bitcoin

 

Bitcoin, daily: still holding firm after the initial 'mini crash' – click to enlarge.

 

 

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Tue, 10/08/2013 - 18:07 | 4035782 The Shootist
The Shootist's picture

How many characters are a PIN? Shouldn't be hard.

Tue, 10/08/2013 - 18:15 | 4035794 animalspirit
animalspirit's picture

Characters for a Bitcoin private key?  32 (or, 256 bits).

Enough to keep all the computers on the planet busy until long after the sun burns out.   And then for a few trillion years after that as well.  And that's just to spend the funds for a single Bitcoin address.  Silk Road controlled a ton of addresses.

Now if you are asking about the difficulty in cracking the passphrase used for an encrypted wallet, nobody but Dread Pirate Roberts knows.   If it was easy enough to crack (i.e., less than a few decades) he'll probably share the passphrase with someone he trusts to send the coins to a new address anyway, presuming that hasn't already been done.

Tue, 10/08/2013 - 18:17 | 4035833 EmmittFitzhume
EmmittFitzhume's picture

Haha. Sweet!

Tue, 10/08/2013 - 21:29 | 4036598 MisterMousePotato
MisterMousePotato's picture

@animal ... if only upper/lower alphanumeric characters are used (which is my recommendation), then 43 characters will lend 256 bits of entropy. Interestingly, one will find in the literature that there is no expectation that any digital computer (or combination thereof) will *ever* be capable of breaking such a password due to currently understood limitations from fundamental physics; in other words, constraints imposed by such things as the total energy output of the sun since the beginning of time and/or the number of atoms in the universe or similar exercises in astrophysics, which I really don't understand very well, but, fortunately, I don't have to to understand them at all in order to know how to create, use, and safeguard passwords that will resist any and all efforts to undermine them. (At least for the nonce.)

(Cue the quantum computer nerds.)

Tue, 10/08/2013 - 18:22 | 4035844 VD
VD's picture

would be next to impossible to send coins to new addy since FBI would track them and next reciepient gets busted. better to legalize all drugs and cut FBI by 60%, but then the real agenda is prison-industrial complex and gov control. one day new consciosness will render these gov agencies much smaller...at least that's the dream...

Tue, 10/08/2013 - 20:27 | 4036400 Non Passaran
Non Passaran's picture

> FBI would track them and next reciepient gets busted.

LOL.
How exactly would they do that?
I'll give them a bitcoin address and let's try.

Wed, 10/09/2013 - 00:17 | 4037014 SpykerSpeed
SpykerSpeed's picture

There's no way to know who controls a Bitcoin address, dummy.

Tue, 10/08/2013 - 18:31 | 4035891 JuliaS
JuliaS's picture

I'm wondering if the FBI rented out its last waterboard.

http://xkcd.com/538/

Tue, 10/08/2013 - 18:52 | 4035960 Pool Shark
Pool Shark's picture

 

 

Assuming DPR makes bail sometime in the next few months; what's to stop him from transferring/spending those Bitcoins himself?

 

Tue, 10/08/2013 - 19:00 | 4035994 Silver Bully
Silver Bully's picture

'Silk Road controlled a ton of addresses.'

Note: part of the attraction of bitcoin is that there is a finite number of them that will eventually be 'mined'. I.E - a limited supply.

So now that the Feds have effectively taken 600,000 bitcoins off the table (or 5% or ALL bitcoins currently in existence, according to the article), won't this affect the exchange rate of bitcoins just a tad?

Just a (bullish) thought.

Tue, 10/08/2013 - 19:27 | 4036151 DCFusor
DCFusor's picture

Sadly, you need to learn a little more crypto and computers.  256 bit keys are quite breakable these days, if you have the computers, and the government does indeed have the computers specialized for just that.  Give them a couple weeks, not the age of the solar system, tops.

Tue, 10/08/2013 - 19:29 | 4036176 Papasmurf
Papasmurf's picture

There are 256 processors on one card, many cards in a rack, many racks in a center.  This can be cracked in short order with a parallel attack.

Tue, 10/08/2013 - 20:07 | 4036332 TheHound73
TheHound73's picture

If this were actually true, the cost of the hardware would be negligible compared to the coins gained if you crack, for instance, address 1933phfhK3ZgFQNLGSDXvqCn32k2buXY8a (111,111 BTC or $14mil).  But your statement is false.

Tue, 10/08/2013 - 21:33 | 4036614 MisterMousePotato
MisterMousePotato's picture

The Hound is correct. In fact, there is no expectation that any digital computer (or combination thereof) will *ever* be capable of breaking a password with 256 bits of entropy due to currently understood limitations from fundamental physics; in other words, constraints imposed by such things as the total energy output of the sun since the beginning of time and/or the number of atoms in the universe or similar exercises in astrophysics.

Tue, 10/08/2013 - 22:16 | 4036737 ForTheWorld
ForTheWorld's picture

"AES permits the use of 256-bit keys. Breaking a symmetric 256-bit key by brute force requires 2128 times more computational power than a 128-bit key. 50 supercomputers that could check a billion billion (1018) AES keys per second (if such a device could ever be made) would, in theory, require about 3×1051 years to exhaust the 256-bit key space."

https://en.wikipedia.org/wiki/Brute-force_attack

I know, I'm quoting Wikipedia, but the math is sound.

Wed, 10/09/2013 - 04:44 | 4037217 fourchan
fourchan's picture

well that sounds more secure than my passbook saving account ben has access to with his printer.

Wed, 10/09/2013 - 01:11 | 4037087 GoldMeUp
GoldMeUp's picture

Sadly, you need to learn a little more crypto and computers.  256 bit keys are quite breakable these days

 

Umm, lol.  Someone is a bit misinformed. 128-bit keys are beyond brute forcing for the far forseeable future.  256-bit keys are unimaginably impossible to brute force.  It most likely will never be done, even in thousands of years time.  128 is impossible anyway, but 256 is used just in case quantum computers are invented, because 256 will be impossible even with powerful quantum computers.

Tue, 10/08/2013 - 18:18 | 4035830 Bangin7GramRocks
Bangin7GramRocks's picture

N-WORD PLEASE! Sell your wares somewhere else. The FBI hasn't looked very hard. The NSA can crack any code and find anything digital. Deal with their omnipotence! Bitcoin is not secure from the government.

Tue, 10/08/2013 - 18:28 | 4035863 CH1
CH1's picture

The NSA can crack any code and find anything digital.

Tell that to Ed Snowden.

Ignorance is part of life, but acting like you know something - when you have no freeking idea - just exposes you to pain.

Learn something or be quiet.

Tue, 10/08/2013 - 18:36 | 4035914 Bangin7GramRocks
Bangin7GramRocks's picture

And what about Ed Snowden? Do you really believe they had no idea he was stealing data and then took a unplanned trip to Hong Kong? OK Slappy, how about this angle. Hey Silk Road Cyber Punk. Tell us all the details and how to get your stash or we sentence you to life in a SuperMax prison. He will shit his pants and then tell them everything. You want there to be rebels who can beat the system, but it just doesn't exist anymore.

Tue, 10/08/2013 - 18:45 | 4035941 James_Cole
James_Cole's picture

 

NSA always uses backdoor access or courts to get keys. 256 encryption can't be hacked in the cryptography sense. 

 

Tue, 10/08/2013 - 19:26 | 4036158 DCFusor
DCFusor's picture

Ask Bruce Schneieir about that.  Y'all are just wrong about it.  Yes, they can!  Takes awhile, but not "Forever".  Not hardly.

Tue, 10/08/2013 - 19:41 | 4036237 CH1
CH1's picture

Did you even READ Schneier? He says that the algos are good. What he said was that the NSA subverted the certificate authorities.

LEARN BEFORE PONTIFICATING.

Tue, 10/08/2013 - 20:07 | 4036326 sessinpo
sessinpo's picture

apparently, progress is being made.

Andrey Bogdanov, from K.U.Leuven (Katholieke Universiteit Leuven), Dmitry Khovratovich, who is full time at Microsoft Research, and Christian Rechberger at ENS Paris were the researchers

Bogdanov added that the crack works on all versions of AES and dispelled some myths about the technology as well.

"Unlike previous results on AES, we do not need any related keys which was a very strong and unrealistic assumption about the power of the attacker," he explained.

"Our attacks work in the classical single-key setting and, thus, apply in every context, however, with huge complexities so far. The practical consequence is that the effective key length of AES is about 2 bits shorter than expected - it is more like AES-126, AES-190, and AES-254 instead of AES-128, AES-192, and AES-256. We think it is a significant step toward the understanding of the real security of AES."

The attack has been confirmed by the creators of AES, Dr Joan Daemen and Professor Dr Vincent Rijmen, who also applauded it.

Tue, 10/08/2013 - 20:24 | 4036393 Non Passaran
Non Passaran's picture

If he had a copy of the wallet and if he manages to get the message out by the time they crack the confiscated wallet the coins will have been used.

Tue, 10/08/2013 - 19:59 | 4036309 dark pools of soros
dark pools of soros's picture

you are a stooge

 

the feds may have the cold storage but that can be replicated by someone else and unlocked if they have the key from DPR...  then they could be transferred to 10,000 addresses to spread it all around..  they can only do anything once it is exchanged for money and I doubt they would track down someone selling some of those coins on the streets of a few bumfuck cities around the world

 

But, I will say this DPR seems to be a bagholder patsy..  if you are wondering what I just implied, you need to go watch the Princess Bride

 

Tue, 10/08/2013 - 20:59 | 4036492 Simplifiedfrisbee
Simplifiedfrisbee's picture

Why not simply create a new virus and spread to bitcoin sites/merchants? Infect the members.

Tue, 10/08/2013 - 19:46 | 4036248 CH1
CH1's picture

Do you really believe they had no idea he was stealing data and then took a unplanned trip to Hong Kong?

Ah, I see... you got a secret message on your decoder ring.

Tue, 10/08/2013 - 23:17 | 4036904 Ralph Spoilsport
Ralph Spoilsport's picture

LOL!

Tue, 10/08/2013 - 18:41 | 4035908 notquantumdum
notquantumdum's picture

I'm not convinced the NSA can crack "any" codes.  'Maybe most simple ones.  And, I question just how much the NSA shares with the FBI.  And, any public-private keypair encryption codes -- such as many other online financial transactions are typically conducted -- can theoretically be cracked with some ease if one has access to a quantum computer with sufficient qubits.  Does bitcoin use public-private keypairs?  If not, it might not be so easy to crack.

Does the NSA have enough qubits of quantum computing?  'Not sure, but the scientific papers sure don't seem to indicate any such capabilities being out there just yet.

Tue, 10/08/2013 - 19:24 | 4036143 seek
seek's picture

Actually most of the quantum cracking proposals seem to indicate it just halves the difficulty of the keyspace (e.g. makes a 256 bit key as easy as a 128 bit key.)

So even if they had the capability, it probably won't work very well, and likely wouldn't be wasted on small potato efforts.

There is a growing pile of evidence your initial assumption, that the NSA can't crack "any" codes, is valid. Lavabit being just the most recent case, it's pretty clear the NSA relies on technical means to intercept communications, but legal means to compel the disclosure of encryption keys. That certainly makes their supposed code-breaking cajones look rather small, given that they need lawyers handing them the keys to listen in.

Tue, 10/08/2013 - 19:36 | 4036205 DCFusor
DCFusor's picture

Not slamming you, but the difficulty goes up exponentially, not linearly, with number of bits in almost all systems.  Eg, 256 bits isn't twice as hard to crack as 128, but 2^128 times as hard.  Much of the above is ignorance of crypto.  Go buy a book, say Applied Cryptography and learn something.

"Rubber hose" crypto is indeed more popular with the goons in .gov, as it's often faster and cheaper - and they get what they want by claiming to "reduce" the charges.  Kind of like a store that marks up everything 100% one day, then offers a 50% off sale...and suckers fall for it.

Tue, 10/08/2013 - 21:56 | 4036626 MisterMousePotato
MisterMousePotato's picture

DCF is correct. In fact, there is no expectation that any digital computer (or combination thereof) will *ever* be capable of breaking a password with 256 bits of entropy due to currently understood limitations from fundamental physics; in other words, constraints imposed by such things as the total energy output of the sun since the beginning of time and/or the number of atoms in the universe or similar exercises in astrophysics.

And even conceding the point made by sesinpo, supra, so what? Make it 44 upper/lower alphanumeric characters and we're talking - what? - 260? 265? bits of entropy. Even conceding further the reality of quantum computing (which I'll believe when I see) ... so what? Make it an 88 character password (actually, it'd be far less, but you get the point [I'm too lazy to do the math; not easy for me]) and we're back to never, ever 'crackable'.

And what's the difference? Is it really that much easier to copy and paste a 43 character string than an 88 character string? Just gotta hide it, and there's a zillion ways to do that, i.e.:

copy /b [anyimage].jpg + [secretpassword].txt[(encrypted).zip] etc./whatever [son's graduation].jpg

Or how 'bout some random 32/43/44/88 or, oh, say, 83 character piece of one of those keys generated by PGP or OpenPGP (sp?) (and stored openly in your documents's folder)or, for that matter, ever look at the header of some email saved on your disk? Down 2 rows, over 13, and the next 47 characters oughtta do it. Actually, any such 47 characters *will* do it.

Do not let TPTB convince you that they have some magic McGiver computer somewhere that will allow them, no matter what you do, to get at what you don't want them to get to. There isn't, and they can't, provided you don't choose "password123" or "Qeadzcwrsfxv1331" (actually quite clever ... try typing it) as your password.

Make a truly random jumble of sufficient length, and it cannot be broken, and will never be breakable, either. (Unless Ovomit and the GOP-e sit down and negotiate a repeal of the laws of physics.)

Tue, 10/08/2013 - 19:36 | 4036203 notadouche
notadouche's picture

They may be able to crack any code but apparently have problems in tracking internal emails.  That is where the bitcoin is most secure.

Tue, 10/08/2013 - 19:28 | 4036156 TheHound73
TheHound73's picture

"How many characters are a PIN? Shouldn't be hard."

256 bits in a bitcoin private key.

 

Wed, 10/09/2013 - 02:54 | 4037149 Hobbleknee
Hobbleknee's picture

"Since it is not possible to identify them"

Actually, they can identify them.  Straight from Bitcoin's site:

"However, Bitcoin is not anonymous and cannot offer the same level of privacy as cash. The use of Bitcoin leaves extensive public records."

Wed, 10/09/2013 - 08:26 | 4037416 lucyvp
lucyvp's picture

it doesn't matter that they can't get the coins. what else can they get? Can they steal this guy's house, cars, throw him in jail, throw is mom in jail?

BTW I'm sure the NSA has the password :)

Tue, 10/08/2013 - 18:06 | 4035786 Teddy Tenpole
Teddy Tenpole's picture

 

 

FBI is so 1980s.

Tue, 10/08/2013 - 18:13 | 4035798 One And Only
One And Only's picture

I think bitcoin is the closest thing to currency perfection we have.

No one can point to a single flaw in it.

Tue, 10/08/2013 - 18:22 | 4035850 Herd Redirectio...
Herd Redirection Committee's picture

You offer a girl 10 bitcoins, and I'll offer gold jewellry (weighing 1 troy oz), and let her decide.

Tue, 10/08/2013 - 18:27 | 4035871 CH1
CH1's picture

You offer a girl 10 bitcoins, and I'll offer gold jewellry (weighing 1 troy oz), and let her decide.

And if she chooses Bitcoin, don't ever let her go!

Tue, 10/08/2013 - 19:06 | 4035907 JuliaS
JuliaS's picture

If a guy offers you 10 bitcoins and you take them, he won't ever let go of you. He's an FBI agent.

Tue, 10/08/2013 - 18:42 | 4035923 Pladizow
Pladizow's picture

@ One And Only

Bitcoin flaw = At the mercy of the internet!

Tue, 10/08/2013 - 18:54 | 4035966 One And Only
One And Only's picture

Life as we know it is at mercy to the internet.

Most dollars for example exist as 10001010100101010.

Shut off the internet - common currency evaporates as well.

Tue, 10/08/2013 - 18:31 | 4035889 All Out Of Bubblegum
All Out Of Bubblegum's picture

Smart girls would look at some charts and then take five bitcoins based on their performance in the past two years and half an oz. of Au.

Diversity never hurts.

Tue, 10/08/2013 - 18:26 | 4035852 Jump The Shark
Jump The Shark's picture

The currency exchanges are the only things corruptible. The bitcoin is a mathematical certainty.

Tue, 10/08/2013 - 18:53 | 4035964 Jump The Shark
Jump The Shark's picture

Here is the link to blockchain info page where people left messages for the FBIs bitcoin wallet.
http://blockchain.info/address/1F1tAaz5x1HUXrCNLbtMDqcw6o5GNn4xqX?offset...

Tue, 10/08/2013 - 18:23 | 4035853 Teddy Tenpole
Teddy Tenpole's picture

 

 

 

umm, what is it's not backed by gold alex?

Tue, 10/08/2013 - 18:33 | 4035890 ForTheWorld
ForTheWorld's picture

If it's physical, it can be confiscated. Of course, turning off the electricity prevents Bitcoins from being exchanged, but then again, without electricity, we're pretty screwed.

Tue, 10/08/2013 - 19:41 | 4036235 TheHound73
TheHound73's picture

Time to position myself long abacuses ;)

Tue, 10/08/2013 - 18:25 | 4035855 TheCanadianAustrian
TheCanadianAustrian's picture

I think it's funny that the same people who turn up their noses at Bitcoin for not having "intrinsic value"

...

are the same people who keep "dry powder" fiat for when the price of gold and silver drop.

Tue, 10/08/2013 - 20:13 | 4036337 dark pools of soros
dark pools of soros's picture

you haven't figured it out yet here???

 

my 4 year degree @ ZH academy has learned me that all those 'keep stackin' sheep are on their fixed income pension/disability/SS/etc and once a month robotically spend a % of their ration of fiat on some PMs

 

that is why you see them cry on one side when the price crashes, but then also say, 'Great I can by MOAR pieces of my precious!'

And then also cheer when the prices rise, but then also cry about 'buying opportunities' and really wish it would just dip once a month when they get their dry powder allocation

 

Wed, 10/09/2013 - 00:33 | 4037045 SpykerSpeed
SpykerSpeed's picture

LOL

So.  Freaking.  True.

They don't like Bitcoin because they can't even use a DVR.

Tue, 10/08/2013 - 18:27 | 4035858 Drachma
Drachma's picture

It's intangible.

Wed, 10/09/2013 - 08:33 | 4037448 PaperWillBurn
PaperWillBurn's picture

Thus cannot be confiscated... and can be carried across borders without even needing to declare it. It being vitual allows it to reside everywhere and nowhere at the same exact time

Tue, 10/08/2013 - 18:25 | 4035862 Againstthelie
Againstthelie's picture

The flaw: It needs technical infrastructure.

If this infrastructure breaks, this money is useless.

 

Money like gold or silver (and even cash) act the other way: when infrastructure breaks, nothing else works anymore, it still works.

Tue, 10/08/2013 - 19:40 | 4036220 DCFusor
DCFusor's picture

If the infrastructure actually breaks, then the only things that matter are food, water, shelter....if those are lacking, then even gold has counterparty risk.

My solar powered farm, if I should run short of food, won't take it so I have gold and starve, and you have the much more valuable food.  I'll shoot you and use your ass for fertilizer first, and oh yeah, keep the gold for when enough infrastructure comes back for it to be worth something again.

Tue, 10/08/2013 - 20:21 | 4036388 TheHound73
TheHound73's picture

On the flip side of that: while the infrastructure is in good working order, this is sexy money.  I can send/receive large or small sums of money to anybody anywhere, quickly, irreversibly, and for next to nothing in fees.  

Tue, 10/08/2013 - 22:34 | 4036787 ForTheWorld
ForTheWorld's picture

Scenario: You have your pay cheque deposited into a bank account, and the banks infrastructure stops working. How are you going to get the cash now if the bank can't access your account (similar to not being able to access your Bitcoin wallet)?

How do people not get that "cash" money is just the physical representation of the (now) digital currency known as the US Dollar (or Euro/Yen/Pound/Rupee)?

Tue, 10/08/2013 - 18:28 | 4035865 Citxmech
Citxmech's picture

It relies on access to a functioning internet (e.g.,  "If you can't hold it. . ." ).  

Tue, 10/08/2013 - 22:34 | 4036791 ForTheWorld
ForTheWorld's picture

So does the bank you lend money to in the form of deposits.

Tue, 10/08/2013 - 18:51 | 4035963 notquantumdum
notquantumdum's picture

Were you being sarcastic?

Tue, 10/08/2013 - 18:09 | 4035801 McMolotov
McMolotov's picture

"His name is Dread Pirate Roberts. His name is Dread Pirate Roberts. His name is Dread Pirate Roberts..."

Tue, 10/08/2013 - 18:13 | 4035816 Uncle Remus
Uncle Remus's picture

Careful kids. This is what you want to hear.

Tue, 10/08/2013 - 18:15 | 4035818 Silver Garbage Man
Silver Garbage Man's picture

Don't underestimate the most powerful people in the world. They will find a way to make life miserable for bit coin. Play it safe with physical metal in hand.

Tue, 10/08/2013 - 18:18 | 4035828 animalspirit
animalspirit's picture

Math only responds to a different type of power.   

Unless you are referring to the government employing rubber hose cryptanalysis to get the password.

Tue, 10/08/2013 - 18:25 | 4035854 MsCreant
MsCreant's picture

Dunno. They make life pretty miserable for us too with some pretty serious fucktardery. Digital monkey hammers naked shorting PMs, di-ludding their value in the matrix, makes for some pretty serious misery, at times. I have it in hand, but those fuckers have control of the so called "market."

Tue, 10/08/2013 - 18:48 | 4035951 Skateboarder
Skateboarder's picture

Market shmarket, there are at least two billion people (Indians and Chinese) who see Ag/Au as real money.

Tue, 10/08/2013 - 20:27 | 4036399 TheHound73
TheHound73's picture

They'll be the next bitcoin stackers.  It's hard to get trade volume data out of China but there are indications the Chinese frequently are buying as many bitcoins as the rest of the world combined.

Wed, 10/09/2013 - 01:52 | 4037105 merizobeach
merizobeach's picture

"there are at least two billion people (Indians and Chinese) who see Ag/Au as real money."

Yeah, that'll do me good if I live in a Chinese speaking country.  Oh, wait...  Winning!  Encouraging my friends here to invest in gold and silver is a pretty easy sell.  :-) 

Tue, 10/08/2013 - 18:31 | 4035877 CH1
CH1's picture

Play it safe...

Stay in bed.

Tue, 10/08/2013 - 20:15 | 4036360 dark pools of soros
dark pools of soros's picture

today's sycophant of the week goes to YOU

 

keep trying and you may become Bootlicker of the Month!!

 

 

Tue, 10/08/2013 - 18:16 | 4035832 A Lunatic
A Lunatic's picture

In other words, the FBI confiscated 26k bitcoins without due process..........again.

Tue, 10/08/2013 - 18:22 | 4035851 VD
VD's picture

that is the vital comment -- they LEGALLY have no right to try and crack the bitcoins and perhaps after failing a few more times will use that argument to excuse their incompetence and perpetual subversion of constitution...

Tue, 10/08/2013 - 18:31 | 4035882 CH1
CH1's picture

What is this LEGALLY, of which you speak?

Tue, 10/08/2013 - 18:34 | 4035906 VD
VD's picture

i know CH1 i was writing in the purely abstract...

Tue, 10/08/2013 - 19:43 | 4036234 Pure Evil
Pure Evil's picture

I guess no one has heard of Asset Forfeiture?

Legalese for we can steal it if we have probable cause which means your fucked.

You want it back, so sue us, see ya in court.

Tue, 10/08/2013 - 19:43 | 4036244 CH1
CH1's picture

i know CH1 i was writing in the purely abstract...

I was just having some fun at Authority's expense. :)

Tue, 10/08/2013 - 19:18 | 4036011 notquantumdum
notquantumdum's picture

'Sure many down arrows to come from this comment, but assuming we're talking about following the "law" -- whether we like it or not -- it would seem to be pretty standard law enforcement practice to legally seize the property in the possession of the ["illegal"] drug dealer when typically arrested (whether the property was actually one of the dealer's customer's money or not, during the ongoing drug-money transaction).

Did silk road conduct any "legal" business transactions?

Ah, then, it would seem things might be more complicated.  Then, the silk road's customers would seem to have a more legitimate claim to the funds for the portion which were the "legal" transactions.  No?

And, let's change the "law" if it shouldn't be illegal in the first place.

Tue, 10/08/2013 - 19:34 | 4036191 notadouche
notadouche's picture

Kind of seems to me like one should be convicted of a crime before seizure of property is exercised.  Sieze all the property and liquidate it then have the trial only to lose.  A free man with no property left.  Hmmm.  Cart before the horse scenario.   I know the authority would never make a mistake like that so no worries.

Tue, 10/08/2013 - 19:40 | 4036223 The Abstraction...
The Abstraction of Justice's picture

The usual means of redress is to sue for wrongful arrest and wrongful seizure. That would seem to be enough. There are already too many criminals walking free, particularly those in high offices.

Tue, 10/08/2013 - 20:37 | 4036425 notquantumdum
notquantumdum's picture

'know what you mean (maybe).  'thought they couldn't liquidate it until some kind of process was completed -- if not due process.  Correct?

Tue, 10/08/2013 - 21:04 | 4036509 notadouche
notadouche's picture

Yep but from my point of view this is the financial version of "shoot first ask questions later" mentality that law enforcement has reverted to.   This is reminiscent of the Hoover days where the FBI blasted away at the Dillinger's and Bonnie and Clydes of the world back in the 30's.  Over the last 24 months I've seen more of this type of "police work" then at any other period in my lifetime.  The media used to frown on this type of justice but doesn't seem to bother them anymore.   The female Rodney King in DC with a baby in the car, no less, was gunned down and no one rioted or even cared. Rodney King takes a beating from some cops and gets LA to burn and millions of dollars in a lawsuit.  Both essentially did the same crime, wreckless driving.  How did the cops in DC not have those tire strips available to throw down to disable the car?  Law enforcement doesn't bother me as much as the indifference by the media.    

Tue, 10/08/2013 - 20:19 | 4036369 dark pools of soros
dark pools of soros's picture

It is part of a crime scene, virtual or otherwise.   No matter what, it will sit until the case is closed.  Then if someone who was just selling poetry or whatever wants to prove he should get his stash back, it may be possible but they may just say fuck it, too hard, bite us

 

Tue, 10/08/2013 - 20:54 | 4036470 A Lunatic
A Lunatic's picture

What has become "standard law enforcement practice" is light years removed from our (supposed) Constitutional guarantees......

Tue, 10/08/2013 - 18:23 | 4035834 Debtonation
Debtonation's picture

At current market depth, a firesale liquidation of 26,000 would drop the price to around $115.  A liquidation of 600,000 would drop the price to near $0. My bet is the FBI isn't smart enough to understand market liquidity. I have a limit order in for $0.01.  This assuming they can crack his encryption

Tue, 10/08/2013 - 18:51 | 4035957 YungHungAndLegal
YungHungAndLegal's picture

Debtonation!  That's the best handle yet!

Tue, 10/08/2013 - 19:07 | 4036017 OpenThePodBayDoorHAL
OpenThePodBayDoorHAL's picture

Good luck to the FBI if they try to sell. The coin owners (or should I say co-owners) are attaching transaction fees to the coins that exceed the value of the coins.

Vires in Numeris!

And by the way, 256-bit encryption means there is a different encryption "secret" for every 900 atoms in the observable universe.

A kid was walking on the beach with his scientist Dad. He asked "Daddy are there more grains of sand in the world, or stars in the universe?"

Scientist Dad replies "Stars in the universe"

"But what if every star was one molecule of water? How much water would that be? Maybe the size of the Atlantic Ocean?"

" No, son, it would take about 10 drops of water".

Ponder that while you try to grasp how small 900 atoms is...

Biggest US computer is around 12 peta-hashes. Biggest worldwide is 35 peta-hashes. Current Bitcoin network: +/- 12,000 petahashes. You'd only need half of that to compromise the network, so let's say 6,000 peta-hashes. Not even close, even if all that Tom Cruise stuff is true. In reality, the NSA can't even find it with both hands. A bunch of shitheads reading their ex-girlfriend's emails.

Tue, 10/08/2013 - 19:36 | 4036212 The Abstraction...
The Abstraction of Justice's picture

The way to crack his password is with social engineering and mindwalking. The password could well be 'DREADPIRATEROBERTS0001

 

Tue, 10/08/2013 - 20:19 | 4036381 dark pools of soros
dark pools of soros's picture

...as you wish

Wed, 10/09/2013 - 03:15 | 4037167 Hobbleknee
Hobbleknee's picture

All bitcoin activity is network activity, and as we all know, the NSA records all of it.

Wed, 10/09/2013 - 04:42 | 4037216 TheHound73
TheHound73's picture

The complete history of all bitcoin activity is recorded by all of us Bitcoiners fully and unencrypted.  Its called the Blockchain.  It is how we protect against counterfeit coins and double-spends.  The creation of private keys used to move bitcoins around is strictly NOT a network activity.

Tue, 10/08/2013 - 19:06 | 4036028 Silver Bully
Silver Bully's picture

'A liquidation of 600,000 would drop the price to near $0.'

I was thinking of the other side of that coin (pardon the pun). 600,000 bitcoins have effectively been removed from existence. I wonder when the exchanges will wake up and react to this? I sense a bullish reaction.

Tue, 10/08/2013 - 20:09 | 4036335 Non Passaran
Non Passaran's picture

I said the other day:
1. Not all Bitcoins circulate to begin with
2. A significant portion of demand has been temporarily destroyed
As seen fom the current exchange rate the event has been price neutral.

Wed, 10/09/2013 - 08:42 | 4037476 PaperWillBurn
PaperWillBurn's picture

Exatcly. HUGE float reduction

Tue, 10/08/2013 - 20:07 | 4036319 Non Passaran
Non Passaran's picture

If they're so stupid to pull the gold dump thing with confiscated Bitcoins, I welcome our idiot government overlords...
I'll create a ton of orders at 0.011 and above, just to make sure I don't end up without any cheap Bitcoins in case they try to get smart with us.

Tue, 10/08/2013 - 18:29 | 4035838 southerncomfort
southerncomfort's picture

confused why this bitcoin silkroad site is shut down...but not google, yahoo, facebook, et al, for pushing around kiddie pornography.  lol.  govt chasing adult consensual transactions - and giving a second screw to abused lil kids.  wow.  what goes around...

Tue, 10/08/2013 - 18:31 | 4035880 MsCreant
MsCreant's picture

Give me "Which platforms does the US government already own, overtly, or by collusion," for 17 Trillion Alex! 

Tue, 10/08/2013 - 19:44 | 4036247 Pure Evil
Pure Evil's picture

Your naughty......I like that.

Tue, 10/08/2013 - 18:21 | 4035840 el Gallinazo
el Gallinazo's picture

That isn't going to change anything, but we suspect that even within the FBI there are by now many people who are questioning whether the 'war on drugs' makes any sense. As noted previously, after more than 30 years, it has yet to attain a single one of its purported official objectives.

Thanks for including "purported official."  As to its real objectives:

!)  As Papa Joe Stalin put it - name the man and I will find the crime.

2)  The world's intelligence networks gross over a half trillion dollars a year from "illegal" drugs.  Hemp, for example, is a very hardy plant.  If it weren't illegal it would sell per kilo at well less than lettuce.  Lettuce ain't gonna make the dudes at CIA, NSA, FBI billionaires.

Tue, 10/08/2013 - 19:43 | 4036239 Portuguese Revo...
Portuguese Revolutionary's picture

And Cocaine from South America? And opium/heroin from Afghanistan? All courtesy of the CIA...

Did you guys forget that Hamid Karzai's brother is on the CIA's payroll and he is THE kingpin...

In Colombia, the US Military trains the Govt troops and the CIA trains and sells arms to the FARC in exchange for the white powder... Why do you think that Barry is always scratching his nose during public interventions?

Poppa Bush was on of the MAJOR opium traffickers in the world... Mitt Romney made lots of money laundering drug cash in Panama...

The war on drugs is GOOD... for them.

Tue, 10/08/2013 - 18:21 | 4035841 Yen Cross
Yen Cross's picture

   Hopefully he sunk a few boats full of PMs. He can negotiate with the shitcoins, and start a salvage business when he gets out of "Camp Supermax"...

Tue, 10/08/2013 - 21:38 | 4036637 Tijuana Donkey Show
Tijuana Donkey Show's picture

He gets nothing, because he was a DUMBASS for staying in the USA. Why not run it from China, Brazil, or anywhere the US has a short reach? Sitting in a coffeeshop, the SAME coffeeshop in San Fran, not even using a disposable cell phone to connect? WTF? I think this whole thing was a PSYOP, and DPR is an agent. The FBI "can't" get to the bitcoins, because they want you to think they can't. They are watching, and like the thought police in 1984, they only take out the dangerous people.......

Tue, 10/08/2013 - 22:51 | 4036830 TheHound73
TheHound73's picture

I don't know.  It seems a whole fuckton of people got really high off of high quality drugs sold on the Silk Road over multiple years using the Post Office as a main disbursement method. If this was a PSYOP, it just goes to show that it "can" be done profitably (allegedly to the tune of $80 million) and now Silk Road copycats are sprouting up all over the place.

Wed, 10/09/2013 - 00:24 | 4037030 SpykerSpeed
SpykerSpeed's picture

"MUH SHINY ROCKS"

Tue, 10/08/2013 - 18:24 | 4035842 Anasteus
Anasteus's picture

I just hope Ulbricht has already transfered all his bitcoins from a copy of his old wallet to a new one (in equally untrackable way) before the FBI cracks the wallet and finds a big pile of invalid bitcoins.

Congratulations, Bitcoin! This is how weird digital currency is becoming sound money.

Tue, 10/08/2013 - 18:26 | 4035864 Teddy Tenpole
Teddy Tenpole's picture

 

 

Wow, you think of all that on your own?

Tue, 10/08/2013 - 18:25 | 4035847 SgtShaftoe
SgtShaftoe's picture

Key strength and cryptography is reliably broken by the rubber hose method.  His wallet is only secure as long as they don't beat him to death.  You heard about what happend to that Chechen guy in Florida right? 

Tue, 10/08/2013 - 18:35 | 4035904 earnyermoney
earnyermoney's picture

Wonder if Ulbricht likes the Med. sea this time of year? Barry will have him transferred to the USS San Antonio for some enhanced interregation er questioning.

Tue, 10/08/2013 - 19:00 | 4035992 SgtShaftoe
SgtShaftoe's picture

The old ways included administration of caffeine which amplifies pain.  I've heard rumors of drugs european spooks would administer that would make a normal person so anxious and rolling in pain they'd jump out a window, all without evidence of laying a finger on them.  I wouldn't want to be senior Ulbricht right now.  Fucking with biggest and most brutal drug cartel in the world then getting caught by them is bad news. 

Tue, 10/08/2013 - 18:39 | 4035921 JuliaS
JuliaS's picture

"Beat-coin"

Tue, 10/08/2013 - 19:13 | 4036073 Yen Cross
Yen Cross's picture

  LMAO! Good One ;-)

Tue, 10/08/2013 - 22:16 | 4036745 TheHound73
TheHound73's picture

But this is also true of all other forms of wealth preservation (i.e., PM hoards).

Tue, 10/08/2013 - 18:29 | 4035878 Againstthelie
Againstthelie's picture

If he is clever, he will have a duplicate of the harddrive containing the bitcoins.

Tue, 10/08/2013 - 18:32 | 4035894 CH1
CH1's picture

Or a Brain Wallet. :)

Tue, 10/08/2013 - 18:34 | 4035901 All Out Of Bubblegum
All Out Of Bubblegum's picture

If he's really smart it's a dummy wallet sitting on an encrypted drive and the bitcoins are in cold storage in a paper wallet at other addresses.

Tue, 10/08/2013 - 18:40 | 4035924 JuliaS
JuliaS's picture

If he was smart, he'd not be caught in the first place.

Tue, 10/08/2013 - 20:24 | 4036398 dark pools of soros
dark pools of soros's picture

this one stinks of patsy... where's the old DPR?  ..living like a king in Patagonia

Tue, 10/08/2013 - 18:56 | 4035971 Bangin7GramRocks
Bangin7GramRocks's picture

What good would it be anyway? He is being charged soliciting murder 3 times and drug dealing. He will never taste freedom again. Whoopidy Doo! I have 100 million is digital currency but insist on a prison with a paperback book.

Tue, 10/08/2013 - 19:56 | 4036292 Non Passaran
Non Passaran's picture

He could order quite a mass murder with those coins :-)

Wed, 10/09/2013 - 05:00 | 4037228 fourchan
fourchan's picture

swordfish.

Tue, 10/08/2013 - 18:42 | 4035933 world_debt_slave
world_debt_slave's picture

yep, the gov will take whatever you have when it wants to and targets you, happened to me in 2007 with they stole all my silver Liberty Dollars and haven't had my stolen property returned.

Tue, 10/08/2013 - 18:48 | 4035954 Poor Grogman
Poor Grogman's picture

With any luck the price can be manipulated down a bit, by .Gov

AU AG BTC All need a good spanking, for simply existing...

Tue, 10/08/2013 - 18:50 | 4035959 villainvomit
villainvomit's picture

Not a fan of bitdong, but just gotta say.....hahahahahahahahahahaha

 

 

Wed, 10/09/2013 - 00:28 | 4037040 SpykerSpeed
SpykerSpeed's picture

Why aren't you a fan of Bitcoin?  It just did something gold can't do.

Tue, 10/08/2013 - 18:59 | 4035967 TaperProof
TaperProof's picture

.

Tue, 10/08/2013 - 19:04 | 4036001 TaperProof
TaperProof's picture

I'm guessing this guy will get a lighter prison term in exchange for handing over the bitcoins?  

Tue, 10/08/2013 - 19:24 | 4036142 Axenolith
Axenolith's picture

Speculative prediction...

There's gotta be a quid pro quo in there.  If there's an enterprising person[s] involved in his detainment, they will talk up the chain that bitcoins aren't worth crap while cutting a slap on the wrist penalty for DPR.  He gives them the key, they levy approx 75-85% of the stash and allow him the rest while that acceptance as a "fine" payment doubles or triples the value of bitcoins overnight.  .gov crook gets a couple hundred mil, DPR is still rich and free, back to your usual evening programming...

Tue, 10/08/2013 - 20:28 | 4036408 A Lunatic
A Lunatic's picture

And Silk Road reopens as a gigantic FED Honeypot. The ultimate gift that keeps on giving for the Fedgoons.

Happily ever after........

Tue, 10/08/2013 - 21:43 | 4036655 Tijuana Donkey Show
Tijuana Donkey Show's picture

It was the whole time. WHO THE FUCK STAYS IN SAN FRAN? AT A FUCKING COFFEESHOP? Total front. Before you downvote me, think about your Sun Zu. "Anything that you think is invinicible, is instantly defeated." Bitcoins are not invincible, and as much as I like the idea, some NSA dick was behind it. A true agent would create a tool to allow the black market to use something they thought secure, only to track them. 

Tue, 10/08/2013 - 19:59 | 4036298 auric1234
auric1234's picture

There's no need. The FBI has methods that can succesfully crack encryption:

https://xkcd.com/538/

 

Wed, 10/09/2013 - 21:21 | 4039965 Global Douche
Global Douche's picture

Really? Of an SHA256 which BTW hasn't been done yet. I sure as hell don't see it happening anytime soon.

Tue, 10/08/2013 - 19:09 | 4036037 q99x2
q99x2's picture

I believe the Kerry-Forbes Cartel has a few more options.

Tue, 10/08/2013 - 19:12 | 4036067 TheFulishBastid
TheFulishBastid's picture

'I am not the Dread Pirate Roberts' he said. 'My name is Ryan; I inherited the ship from the previous Dread Pirate Roberts, just as you will inherit it from me. The man I inherited it from is not the real Dread Pirate Roberts either. His name was Cummerbund. The real Roberts has been retired 15 years and living like a king in Patagonia.'

Tue, 10/08/2013 - 20:25 | 4036402 dark pools of soros
dark pools of soros's picture

amen

Tue, 10/08/2013 - 21:34 | 4036456 Cabreado
Cabreado's picture

I didn't read all the comments; maybe someone has mentioned the fact that an alternative currency with controlling forces in pursuit is destined for either discovery or the underground, and neither destination does much for long-term viability as a "currency."

And now that the auto-negger appears, I'll add...

your dalliance/"investment" with Bitcoin is nothing more than that, and of course you will you attempt to protect it.
Anyone in your shoes would do the same.

Wed, 10/09/2013 - 09:23 | 4037581 TheHound73
TheHound73's picture

Do you have any better ideas?  Just suck it up and go with the status quo?

Tue, 10/08/2013 - 21:34 | 4036619 DaveA
DaveA's picture

This is DPR's buried treasure. He's probably hidden encrypted copies of his wallet all over the place, on web archives and USB cards. If he ever gets out of prison, he'll enjoy a very comfortable retirement in a non-extradition country.

Wed, 10/09/2013 - 00:45 | 4037051 SilverMoney1
SilverMoney1's picture

1 guy owns 5% of the monetary system.

 

Seems legit.

Wed, 10/09/2013 - 00:59 | 4037068 GoldMeUp
GoldMeUp's picture

Oh, so what happened to ZeroHedge calling the end of Bitcoin when the SR news was announced?  Going to admit that it was a stupid call?

Wed, 10/09/2013 - 08:20 | 4037401 lucyvp
lucyvp's picture

it doesn't matter that they can't get the coins. what else can they get? can can steal this guys house, cars, throw him in jail, throw is mom in jail?

BTW I'm sure the NSA has the password :)

Wed, 10/09/2013 - 21:17 | 4039951 Global Douche
Global Douche's picture

Me thinx DPR may well keep the cards close to his chest, unless of course the Feds decide to TORTURE him. (anything new here??) Taking him out in International Waters or Club Gitmo might be something they'll consider. I certainly pray that DPR holds strong and gets a better deal out of it. Certainly sweet for the overall security of Bitcoin!

Sat, 10/12/2013 - 20:19 | 4048982 GoldVsFRNdotCOM
GoldVsFRNdotCOM's picture

BITCOIN...

Expect Them!

Do NOT follow this link or you will be banned from the site!