Bitcoin Forum

This judgment also gives the receiver authorization to convert the Bitcoin to dollars. (http://qntra.net/2014/11/court-order-bfl-to-transfer-bitcoins-to-court/)

THIS IS BAD!

Does the court know much about bitcoin technology? How does the court hold the receiver responsible for "bitcoin theft"  ;) (uknowwhatimean).

Stupid judge should assign some expert bitcoiners to setup multisig. Giving the receiver full control of those coins = says good bye to them already.

It's something. I just wonder how much is going to be left for BFL victims after the receiver hires all of the help they are authorized to.

will BFL transer the bitcoins and can the court enforce this.
for bitcoin this is not a problem.

I'm ok getting my refund in Bitcoin or usd... I know how to get it back into Bitcoin regardless.

The State has shown its teeth again - the rest is mere implementation detail.                :(

To paraphrase the court order: "Gimme dat. Now! Something about kneecaps."

I am no fan of BFL - my few transactions with them were an expensive disaster - but this development is ominous. BFL is an unpopular outfit and few will object, but for me there is a Big Picture issue in play.

The best encryption is useless when bypassed. Think "waterboarding" or "Do it to Julia".

This vulnerability needs a strong technological remedy. I know there has been talk of a deadman's switch approach so that someone under duress could truthfully say that they don't know how to access their account - it gets messy "afterwards" when/if the period of duress ends, and of course governments historically have been willing to extend duress indefinitely "until you talk".

On another front - there is of course a need to deal with the BFLs in life and not get burned by them, but imho that end does not justify the means presently used or the precedent being set.

The precedent, put starkly: "Got crypto? Hand it over".

Rubbish.
The message is that this is no different to any other asset.
They have been ordered to hand it over because they are in receivership.
BFL can be ordered to hand over their bank accounts. They can be ordered to hand over their stock. They can be ordered to hand over physical property. They can be ordered to hand over their Bitcoin.
Why would you think that they couldn't be ordered to do that?
Why should Bitcoin be treated any differently to any other asset?

You assume that the State has the right to seize assets at will. I do not.

BFL has not (yet) been convicted of anything.

Edit: my first answer to this (above) was rushed and intemperate. I was irritated at the poster's bellicose style. He asked a really important question though, even if his intention was to ask it rhetorically.

My more considered opinion is something like the following.

BTC is a mathematical entity. It is not an asset class that has ever been regulated before.
It is not an asset class at all. Calling it an asset does not make it an asset, although it is certainly possible that a bullying entity can treat it as such in the short term.

A BTC is a number, an abstraction. We are used to seeing it in various surface forms, perhaps an ASCII, hex or binary string, or an array of NAND gates or transistors, but the underlying entity is a number.
We are used to thinking of BTC transactions as requiring computers, but the computers are just a (very) convenient facilitator to manipulate the numbers quickly.

The same is true for a wallet full of BTC or the whole blockchain for that matter.

The entire BTC ecosphere is nothing but numbers - "abstractions all the way down". The algorithms that manipulate those numbers are themselves implemented as numbers, by the way.

"Handing over a BTC stash" requires telling someone a number - no more, no less.

The number is, of course, large and messy. However, it is not a deed to a ranch, or a key to a buried strongbox full of gold, or even a number combination that can be used to open a vault full of diamonds. It is a number that can, under some circumstances, be used to manipulate other numbers. No more, no less.

The State has put itself in the absurd position of demanding that people reveal a number, after which the State might decide to auction that number (now "theirs") to a highest bidder who will then become the new "owner" of the number.

In my opinion, this state of affairs has arisen because of tactics used by the BTC Foundation to appease regulators, and by the mindset of regulators themselves.
Murck, in a recent interview, described with apparent pride how it is more effective to tell regulators that your new entity (BTC) is really just like something they already know how to regulate - don't stress its novel features, instead stress its familiar features.

I certainly understand how this approach would help grease the wheels of the regulatory process.

Unfortunately, saying that something is different than what it really is leads to future problems.
It leads to regulations that are inappropriate for what the entity really is.

I believe that for those of us early adopters who imagined that BTC might be a stateless, state-free, state-proof way of transacting with peers - these attempts to make BTC fit a familiar Procrustean State-manipulated form are most unwelcome.

If BTC morphs into Statecoin, as it may do, then I imagine something else will arise that more closely fits the original vision.

Time will tell.

Yes, convert the BTC to USD, so that any returns will be at a loss even if the receiver doesn't take a cut. Evil.

How does it change anything?
There is only X amount of money to share out between creditors, whether you express that X in BTC or USD, it doesn't change the amount.
If BTC goes up after they exchange, it would have been better to keep it.
If BTC goes down after they exchange, it was better the exchange it.

Creditors should get back the asset (remember, BTC is defined as an asset currency by IRS) they paid. Would it be acceptable to sell a bunch of specific gold, silver, paintings off? No. Give the assets back when the civil judgement is rendered.

And what about creditors who are owed USD?
What proportion of the amounts owed are BTC, and what are USD?
How much total BTC will be recovered? How much total USD will be recovered?
None of those figures are known.
The receivers will liquidate any non-money assets owned (yes, including gold, silver or artwork) to determine the final asset value to be shared out.
The BTC are not still yours, held on trust by BFL. You are a creditor, and they owe you a debt.

I'm sure most of the BTC they mined is long gone.