FBI Seizes DPR's personal coins! 144,000 coins!

[allthingsluxury]

How did they obtain the password? A deal? Torture? These 144K Bitcoins will be sold eventually.  Thought it would have a bigger effect on the price? Or was that already expected?

That's the million dollar question! As sloppy as he was, I highly doubt he stored it without good encryption!

More than likely it was one of the above.

[kokojie]

God DPR is a fucking moron. don't get me wrong I'm all for freedom, but bloody hell!

amateur mistake lead to his capture.

really amateur way of letting all his coins get captured.

why didn't he just hide 10,000 in a dozen random places. God I know if I had 20 million I'd hide it in at least 5 different spots.

I just hope that all the coins are sold off in one go.  plummet the price so I can clean up

I always thought DPR was an arrogant douche, he always talk like he's so smart and he can never be caught. He reveals so much information about himself, and thought nobody could connect the dots. Success breeds complacency and hubris, it always happens.

[TippingPoint]

That leads to a reevaluation of Bitcoin security methods following a Search Warrant Scenario.

Most Bitcoin users operate totally within the law.  So any thoughts on this subject would be purely academic.  

Most conceivable Search Warrant Scenarios (for a wide range of offenses) would result in seizure of computers, digital storage media, and written documents from the specified residence.  In major cases, where it is suspected that the storage media is thoroughly encrypted when not in use, law enforcement personnel have demonstrated techniques of seizing computers "hot" after the encryption is unlocked and the device is in use by the user.

Which would then suggest counter techniques of storing encrypted information off-site and/or storing multiple private keys off-site, in either digital form or durable object "written" form.

Recent events illustrate the potential benefits of multiple accounts, rather than one large one.  Almost all arrested individuals are eligible for bail, and even those who are not are allowed visitors and communication with attorneys and relatives.  It does not require too much imagination to see how access could be given to one or more Bitcoin addresses for bail, attorney fees, prison barter goods, etc. without an unacceptable risk of losing the entire bankroll.  But if the funds are in one very large account, a very high degree of trust would be necessary before disclosing a private key.

Imagine how a person could obtain benefits from some or all of his Bitcoins after all his computer equipment and documents are seized and not returned.  It may be easier to imagine if you assume that the individual lives under a repressive regime.  You know.  One of those evil ones.

[benjamindees]

Most Bitcoin users operate totally within the law.  So any thoughts on this subject would be purely academic.

Knightmb operated totally within the law.  He was still raided by the Secret Service*, solely for the crime of owning a lot of Bitcoins and being publicly identifiable.

*FYI the Secret Service is a division of the US Treasury.

It may be easier to imagine if you assume that the individual lives under a repressive regime.  You know.  One of those evil ones.

[User705]

...

Most Bitcoin users operate totally within the law.  So any thoughts on this subject would be purely academic.  

...

I think what you mean to say is most users intend to operate within the law.  The reality is that it is all dependent on interpretation.  For example the following can be seen as violations of various AML and KYC and other laws that most major countries subscribe to
http://blockchain.info/largest-recent-transactions

[ekiro]

I didn't see this posted anywhere yet. If it is, feel free to remove.

It'll be interesting to find out how they got the private key. I would assume he had it encrypted in some form. If he didn't tell them, how would they have gotten it?


http://www.forbes.com/sites/andygreenberg/2013/10/25/fbi-says-its-seized-20-million-in-bitcoins-from-ross-ulbricht-alleged-owner-of-silk-road/

I could use some of those coins....

[rpietila]

Knightmb operated totally within the law.  He was still raided by the Secret Service*, solely for the crime of owning a lot of Bitcoins and being publicly identifiable.

*FYI the Secret Service is a division of the US Treasury.

What's the story? PM OK.

[TheButterZone]

http://www.reddit.com/r/Bitcoin/comments/12yfnk/cats_lead_feds_to_knightmb_worth_371kbtc_in/

[rpietila]

http://www.reddit.com/r/Bitcoin/comments/12yfnk/cats_lead_feds_to_knightmb_worth_371kbtc_in/

So as a quick read, they suspected him of an unrelated crime and investigation created lots of grief to him and the family. Just enough hints that the real issue is that he is having too many bitcoins and/or being too vocal about them. Poor guy, but good to see that he is still active in the forum.

The same trick was played on me on 2008 (due to silver, which prior to bitcoin was the lynchpin of the monetary economy) and it actually worsened my mental condition a lot. The good side is that I made my fortune as a result because I got a LOT more credibility for my claim that the govt hates silver, and as a result you should buy some from me

[TheButterZone]

This is the latest AFAIK: http://www.justice.gov/opa/pr/2013/June/13-crm-721.html

[rpietila]

Is there any evidence that he is behind the prank?

Note: in my case there never was any, and the chief investigator admitted it in the beginning, yet they confiscated all my property for 7.5 months..

[Herp]

He might have struck a deal. Gave them access to the wallet in exchange for dropping the murder charges. In recent Forbes article there's no mention of him facing murder chargers anymore.

[rpietila]

He might have struck a deal. Gave them access to the wallet in exchange for dropping the murder charges. In recent Forbes article there's no mention of him facing murder chargers anymore.

Sorry, I was talking about the off-topic of knightmb, and even my own experiences.

[pokerFace2]

He might have struck a deal. Gave them access to the wallet in exchange for dropping the murder charges. In recent Forbes article there's no mention of him facing murder chargers anymore.

I doubt about dropping the murder charges if he really murdered someone. And if he does not, does the murder charge mean anything at all ?

[Inedible]

http://www.reddit.com/r/Bitcoin/comments/12yfnk/cats_lead_feds_to_knightmb_worth_371kbtc_in/

A the cat's identification led to knightmb? Sounds more like parallel construction to me...

They probably already knew who they were going after but just needed some way of reaching him without letting everyone know they had intel on him from nefarious communication capture techniques.

[Vigil]

I don't see anything that proves they actually have cracked any encryption. For all we know they just have a wallet.dat file with no key.

[jabetizo]

I don't see anything that proves they actually have cracked any encryption. For all we know they just have a wallet.dat file with no key.

then why would they move the coins so long after the arrest? i'd say he used a moderately strong wallet password and they cracked it.

[Chronikka]

I don't see anything that proves they actually have cracked any encryption. For all we know they just have a wallet.dat file with no key.

They couldn't move the coins without the key. And they obviously did move...Anyways here is the official FBI press release from Friday. Straight from their site:

http://www.fbi.gov/newyork/press-releases/2013/manhattan-u.s.-attorney-announces-seizure-of-additional-28-million-worth-of-bitcoins-belonging-to-ross-william-ulbricht-alleged-owner-and-operator-of-silk-road-website

[Hfleer]

Well that's certainly a nice take for them.  What a profitable venture that was.

[Chronikka]

Well that's certainly a nice take for them.  What a profitable venture that was.

Yeah no kidding...170k BTC already in hand from the SR seizure? That's about 1.5% of all BTC in existence from just one court case. Imagine Seizing 1.5% of all USD in circulation lol.