HomeLatest ThreadsGreatest ThreadsForums & GroupsMy SubscriptionsMy Posts
DU Home » Latest Threads » Forums & Groups » Main » General Discussion (Forum) » U.S. government makes its...

Thu Jun 27, 2013, 10:37 AM

U.S. government makes its first-ever Bitcoin seizure

By Tim Sampson on June 26, 2013

The U.S. government may not print Bitcoin, or regulate it, but apparently the feds can still seize it.

Earlier this week, the federal Drug Enforcement Agency reported that it had seized 11.02 bitcoins—roughly $814—from a South Carolina man attempting to buy illegal substances with the world's leading digital currency. It's the first known seizure of Bitcoin by the U.S. government, signaling just how seriously the feds take Bitcoin and the online black markets it fuels.

A report from the DEA notes that the money was netted in April. Little detail is provided about the seizure, which appears on the third-to-the-last page of a 128-page document. Its not even clear what substance the suspect was trying to buy. But for Bitcoin experts, the particulars of this case are less important than the apparent fact that the U.S. government is performing sting operations on Bitcoin sites.

"The DEA appears to have been the first agency to seize actual Bitcoins from an individual with this seizure," wrote Brian Cohen and Adam B. Levine on the blog Let's Talk Bitcoin. "Exactly how the Bitcoin was seized is not known as of this writing."

How the funds were seized is still technically a mystery, but the authors of the Let's Talk Bitcoin piece and others have their theories. The prevailing wisdom is that a Bitcoin seizure could have occurred one of two ways. Since there is no evidence that Bitcoin itself was compromised, a DEA agent would have either had to take control of a computer with an unencrypted wallet and transfer the amount to a DEA controlled wallet, or they would have had to set up a "honeypot" sting on the popular Silk Road Internet black market, where Bitcoin is regularly used to purchase contraband. In that case, the alleged criminal would have unknowingly transferred the Bitcoins to the DEA himself.

more
http://www.dailydot.com/business/11-bitcoins-seized-government-dea/

4 replies, 882 views

Reply to this thread

Back to top Alert abuse

Always highlight: 10 newest replies | Replies posted after I mark a forum
Replies to this discussion thread
Arrow 4 replies Author Time Post
Reply U.S. government makes its first-ever Bitcoin seizure (Original post)
n2doc Jun 2013 OP
leftyohiolib Jun 2013 #1
Rex Jun 2013 #2
Catherina Jun 2013 #3
Democracyinkind Jun 2013 #4

Response to n2doc (Original post)

Thu Jun 27, 2013, 10:43 AM

1. using bitcoins to buy drugs?

 

In that case, the alleged criminal would have unknowingly transferred the Bitcoins to the DEA himself.

so the dea is selling drugs on line now?

Reply to this post

Back to top Alert abuse Link here Permalink


Response to n2doc (Original post)

Thu Jun 27, 2013, 10:44 AM

2. Just recently learned about Bitcoins

 

and all the malware and viruses that go along with them.

Reply to this post

Back to top Alert abuse Link here Permalink


Response to n2doc (Original post)

Thu Jun 27, 2013, 10:45 AM

3. Can't have anything competing with the might dollar n/t

Reply to this post

Back to top Alert abuse Link here Permalink


Response to n2doc (Original post)

Thu Jun 27, 2013, 10:58 AM

4. Question. Wouldn't scenario number 2 be considered entrapment?


I'm not up on drug laws, as I have no need to care for them.

Reply to this post

Back to top Alert abuse Link here Permalink

Reply to this thread