Bitcoin Forum

This may have been posted already, but I didn't see it. If it has, feel free to delete.

http://www.theguardian.com/technology/2013/oct/07/fbi-bitcoin-silk-road-ross-ulbricht

I didn't see this, 600,000 coins is a shit ton of coins!!!! Any proof of these coins being in DPR's possession??

Side note: I did think that he must have a stash of coins and a VERY valuable private key to go with them ;)

All speculation at the moment. There's no way for the FBI to tell if he has 600k bitcoins under his control unless he told them. He could be trolling looking for less jail time  :D

push some needles under his nails, he will be glad to tell you whatever you want to know

The FBI has control over the site, including its database. They can query it and discover how much money he made on commissions.

Yes but there's no way to know how many he has sold since starting the site.

The 600,000BTC figure is based on the maximum possible $80m slice of sales he took, no? I would think his private stash would be a good deal lower than 600,000. Still lots for the FBI to sell if they ever get the key and recover it.

That's sort of what I was thinking. There's no way those coins are all on one wallet is there? Wouldn't that wallet be viewable in the Blockchain?

Below is the FBI's quote from the article. If the wallet is encrypted, then how do they know what's in it? My guess is it must be an encrypted drive, or partition that they can't access, and they are ASSuming that the wallet is there. The one affidavit where the feds were playing hit man it says that he payed for one of the two hits with a cash transfer from a foreign bank, I'd bet that that is where most of his "commission" is. I highly doubt he told them! But then again, he did some pretty f*cking stupid shit!!

"An FBI spokesperson said to Hill that the “$80m worth” that Ulbricht had “was held separately and is encrypted"

I guess the guardian should investigate a little more about their topics before printing such false claims. :-X

Yes, now that you say that, it is. It said in the FBI report that he paid his administrators between $1,000-$2,000 a week, and who knows how many of them there were, plus the costs of running a high security operation like that would likely be pretty high. Even if he had 1/4 of that for his personal gains from the site, that's pretty damn good for 2 1/2 years of work!!

What are you saying? It's actually possible to have more than one copy of a digital file?? ;D

You don't even need a copy of the wallet file, just a hand-written private key will do...
Maybe he just has a flyer for a concert lying around in his bedroom, with a QR code actually containing the private key.

He might even know it by heart, I know I would if I had an address with 600k BTC.

The guardian talks about a message when u encrypt ur wallet file. Something about "all ur backups won't work after this operation" thing.

IMHO, I think those funds will be effectively destroyed. If they ever get unlocked, it will be far, far in the future.

I think thats when you empty our keypool.

I didn't read that he *had* 600K coins in the complaint.  That is just the estimate of the commissions made.  Who knows what was spent, moved to other wallets, converted, etc..

Exactly this.  Plus, the majority of the coins were earned when Bitcoin was worth much less than it is today.  Any coins spent or cashed out during that time would have also been under that same lower price.  He could only have a small portion of those original commissions still in his possession, if any.

I would guess that the funds from the commisions were transfered automatically to an address belonging to an offline wallet under DPR's control. The point is though, to automate that, the address(e) in question had to be hardcoded somewhere in the software on the server. So while we can't say where these funds are, FBI, who had access to the server, knows exactly where they are and if they moved further. That's where the 600k BTC figure may coming from.

From this:

How do they know he doesn't have a brain wallet or a second backup? Seems rather likely IMO.

This will be very interesting to watch. Does DPR hold the keys to 600k XBT? Probably not, but nobody knows for sure.

He could use it as a bargaining chip w/ the feds. He's likely looking at life in prison for his crimes, and the federal prosecutor is likely eager to make an example out of his case to deter the other online black markets that are already cropping up to take SR's customers. But if he's in prison for life, why hand over the money? Instead he can use it to bargain for a lighter sentence. Unlike the existing banking system, the feds can't take the coins without his cooperation.

He could use it as prison currency. Let's say his fellow inmates believe he has 80 million in untouchable, untraceable internet currency. If he dies, the money dies with him. But he could use the promise of that money to buy protection with the promise of riches in the future. Or he could become the target of inmates who think they can beat the information out of him.

Isn't it even possible to generate a deterministic wallet with a seed phrase in some applications? He may be able to restore his wallet by simply recalling a short phrase.

very interesting.

Love this quote:

Really?  So if the exchange rate changes, it might be less or more than the total number of bitcoin in circulation?

The exchange rate has nothing to do with the percentage of the total in circulation.  The author had a bunch of other errors in there too, but what can you expect.

He could have a brain wallet and just never remember the key.  Although they do have ways to compel you - e.g. contempt in jail

That message is about CHANGE addresses. The unused change addresses keypool will be wiped out and a new keypool created when you encrypt your wallet.
Way to do "journalism"... ::)

Exactly. Is it possible to get internet access in prison? If so, its as easy as downloading electrum, remembering "ticket hat grasshopper magazine painter nose" and transferring all your coins to a new address. Then, no amount of noobing on the part of the FBI can get at the coins.

ahahahahahahah  ;D you haven't seen prison

Somebody forward this to Neal Stephenson, this should be the basic plot of his next novel  ;D ;D

No, I actually haven't, but it doesn't seem altogether unreasonable. Presumably you meet with your lawyer sometime. Perhaps your lawyer has a laptop and a phone with tethering. Would it be illegal for him to give you access to it for a couple mintutes? I highly doubt it.

Well at the very least if the 600,000 are out of circulation for an unknown period the FBI may indirectly become a central bank repository for Bitcoins long in the future  ;D
2.8% of all circulation
A tiny mint lol

1. They don't.

2. They will know he (or someone else) has a backup/brainwallet if the 600,000 bitcoins show being moved one day on the blockchain.

He doesn't have to do it all at the same time. Looking at blockchain.info a "normal" day on Bitcoin has about 300,000 worth of Bitcoins being moved around (http://blockchain.info/charts/estimated-transaction-volume) this is after removing "change", if he could somehow emulate "change" transactions that'd even let him cycle through his keys quicker. Spread out those BTC transactions over a week and nobody has to know.

The 600k coins are not in a single address.

As long as he's believed to have control over those BTC, he can never be safe in prison and his family will be at risk of harm.  I'm sure the feds will point that out to him - repeatedly.

His wallet may be "uncrackable" from a technological standpoint, but that's not worth a damn unless he's willing for himself or his family to die in order to protect its contents.

If FBI gets access to his wallet they will probably sell all bitcoins for dollar, and if they sell all coins at once the price will crash down to 10$.
Or if they sell it over several weeks the price might just go down to 50$.

FBI to SELL?  Wow, you US people are totally corrupt...

Well it is the policy of police and I guess the FBI to sell the proceeds earned from drug money to the highest bidder
Although usually it is a motorcycle or fancy car I guess bitcoins would fall under the scope
Again this assumes they have access to the memory wallet too and all of the bitcoins
Good ol Police Auctions XD
For sale 600,000 bitcoins lol.

Seized cash often gets distributed amongst the agencies responsible for the seizure.  As the BTC currently held by the feds could never be spent from that account without everyone realising they were dealing with law enforcement, it makes more sense to liquidate them - even though generally keeping currency is the more logical option.

I'm curious about what sized lots the BTC will be offered in and especially curious about whether the feds will follow the trail of the BTC post-sale ('cos I'm damned sure they'll set it up so that buyers must prove their identity in some way).

The silkroad guy should have burried the wallet in the desert like Walt ;)

http://cdn.uproxx.com/wp-content/uploads/2013/08/breaking-bad-money-650x375.jpg
http://metrouk2.files.wordpress.com/2013/09/walt.jpg?w=650&h=434&crop=1#038;h=684

Buy low sell high then buy non FBI bitcoins with your cash from the Post-Sale Bitcoins of course I guess it depends on how through they are with post-sale bitcoins

check out the top 400 bitcoin addresses.

bottom line is FBI wont be Able to do anything with the 600k btc if they cant crack the wallet password.  DPR probably has multiple backups of the wallet hidden with friends or online.

Bitcoin is ideal for prison use.  It is impossible to find by the guards.  Everyone must get used to using brain wallets - but since they all have much time, this won't be too hard.  Bitcoin is perfect for use by locked up felons - and those on the run!!!  What a great world we live in.

hm... sry for ot, but would it be possible to develop a way/device/software/service where one could pay with bitcoins only via voice/phoneline ? imagine you could say a certain passphrase and the sum you want to spend and this service would execute this order...

That's an excellent way to have the FBI empty your wallet while their tapping your phone. Someone should set this up.

fbi is stealing funds from citizens ? like from those that use telephone banking ? tell me it ain´t so.

a hard fork would be...   uhm... split brain ?

I still cannot believe the FBI has no clue about DPR's main account: They had been following and spying him for quite a long time and then decided to get him. If you delay the arrest of a suspect is because you're waiting for something, like in this case waiting for him to reveal in any way where he's keeping is money or where he keeps the private key. Is it possible the waited for so long without being able to catch it?

Are you on drugs?  The FBI couldn't care less about 600,000 bitcoin. What on earth do they want them for?  Do you think they would sell them and use the money to buy coffee for the agents?  80 million is nothing to the Fed.  There is no motivation whatever for the FBI to stall their investigation until they find the key.  If those 600000 coins go lost forever, the FBI doesn't give a damn.  Everyone who holds bitcoin should just celebrate that that value was instantly returned to the community.  All of our holdings just went up 5%.  The FBI doesn't want those bitcoins for any purpose.  They want that guy in jail - and now he is.  The FBI is starting to look for the next guy already.   They don't care about DPR's key in the least.  Let it die with him.

Maybe, they'd like to prevent him from getting that money to a lawyer.  $80million worth of legal services might bring them a headache.  Otherwise, they don't even want to find that money.

They don't, because if they want your $, they just call your bank.
With BTC they have nobody they can call to seize your wealth, so they might indeed make good use of such a service.

Guys this was posted on another thread but I'll drop it here:

https://blockchain.info/address/1933phfhK3ZgFQNLGSDXvqCn32k2buXY8a

Amount and beginning timestamp are in line. And it was definitely part of a SR tumbler system you can tell from the transaction logs.

Let's all hope it stays that way.

maybe they have installed a keylogger on his computer. or they say: give us the key and you will have only 40 years in jail instead of 70.
i guess they will get the coins.

That's exactly what I thought.. I read somewhere (not sure if it's true or not, but it seems plausible), that FBI was watching him and on the day of his arrest, was waiting for him to access his password-protected laptop in order to arrest him once the password was typed in. That's why I wonder how it's possible they haven't grabbed the rest of the money yet. Analyzing the blockchain, it should be easy for them to see exactly where every satoshi went and possibly quite easy to exchange those wallets' private keys in exchange of some years in jail.   

good point.

1. No (unlike most of the people recently posting in this forum). But thanks for asking, appreciated.

2. Ah, good to know. I must assume you know very well what you are talking about. Who gave you this information, if I can ask? Can you imagine the news if they get the rest of the money? It would be priceless for them, like for any other LEA (Law Enforcement Agency).

3. Maybe because the law says so? And obviously for the same reason mentioned at point 2.

See point 2 again.

4. That's your opinion, I could also agree.

See point 2 again. What do you say? They don't want to grab the money??? The recovery of the assets is always a target, not only to catch the bad guys.

5. If they get the money, THIS will prevent him from using it for paying a bunch of lawyers.

6. You don't need to be aggressive when you share your opinion on this forum! :)

Peace! Cheers!

How would you spend it in prison? Pen/paper and a math textbook? or maybe it will be 'off-chain'?

Attn: Any FBI agent with access to any seized bitcoin private keys,

You can anonymously take those bitcoins and no one will be the wiser. Mix them up a bit and do what you wish with them. It is much easier then stealing drugs or cash out of the evidence room.
 

/me punches a wall

There is an evidence room?

Thats exactly what I thought, if they know the private keys, some FBI savvy dude will steal it. Welcome to the jungle!

Assuming he does tell the FBI, what would be the incentive of the person he tells to reveal to that to the other FBI agents? He could easily just take the coins and claim DPR refused to tell him.

You'd better hope the Fibbies never crack it because if they successfully crack his, they will get around to cracking your.

My $.02.

:)

How is it uncrackable? I heard it may be a brain wallet. What is that?

Its uncrackable because its presumably heavily encrypted and not worth the years of dedicated computing power it would take to crack. A brain wallet is a wallet designed around a simple phrase or collection of words. The idea being you only need to know the phrase and a predictable bitcoin address can be generated using a specific algorithm. It allows the owner to delete any physical copy of the wallet. The only way to get to the coins is to know the phrase. The coins effectively exist nowhere but the mind of the owner, hence the name "brain wallet"

What I thought of when I read this.

http://www.youtube.com/watch?v=rXgb9jG5HKM&feature=youtu.be&t=1m18s

SIX HUNDRED THOUSAND BITCOINS!!!!!!!!!!!!!!!!

Also, if they're in a wallet that's never been spent from, "cracking" it is next to impossible because the public key isn't even available. 

I like this explanation of what I mean (from here (http://www.reddit.com/r/Bitcoin/comments/vf2mw/a_question_about_breaking_the_bitcoin_encryption/c54eyno)):

I'm pretty sure skulls are crackable.

if those coins are split between many addresses and they have separate passwords, then good luck with force bruting it :)

The brain wallet key may be based on a book in the science fiction section of the Glen Park branch of the San Francisco Public Library.

http://static3.demotix.com/sites/default/files/imagecache/a_scale_large/2800-4/photos/1380828039-dread-pirate-robert-arrested-at-library-for-silk-road-drug-site_2857034.jpg

http://static1.demotix.com/sites/default/files/imagecache/a_scale_large/2800-0/1380800-4/photos/1380828046-dread-pirate-robert-arrested-at-library-for-silk-road-drug-site_2857070.jpg

Hint: he was looking at Heinlein (they only have Stranger in a Strange Land)

specific edition:  
Author    Heinlein, Robert A. (Robert Anson), 1907-1988
Title    Stranger in a strange land.
Publication Info.    New York : Putnam, [1961]
ISBN    0441790348
Description    408 p. 22 cm.

Remember me ↓

So you really think it would maybe something like the title of the book? that would be the most smart way to safe a brainwallet....not!

Not the title.

Either a phrase from the book, or based on the x character from pages y through z of that specific edition.

automation ftw

http://brainwallet.org/ (http://brainwallet.org/)

Ulbricht was more often seen curled up in a living roof sofa reading—possibly sci-fi novels from the local library–when not at his computer.
http://www.forbes.com/sites/ryanmac/2013/10/09/living-with-ross-ulbricht-housemates-say-they-saw-no-clues-of-silk-road-or-the-dread-pirate-roberts/

MMMM the power of a beautiful mind :)