I think we're mostly in agreement again. :-)
But I think that we continue to circle around the two part issue of value and ownership; we've talked about possible ways to determine the former but we haven't really talked about how the latter might be demonstrated for legal purposes.
Are you aware of any ruling in any jurisdiction in which someone has posited such an argument but where the jurisdiction didn't already consider bitcoins to be money and didn't (re)classify bitcoins as money as part of any ruling on the case?
The reason I ask is because you refer to demonstrating "control" of the bitcoins but I don't think that control is necessarily synonymous with ownership and (taking your use of that word to be literal) I've been doing a brief review of the legal cases that you've mentioned to see for myself if any precedents have been set; please note that I'm not a lawyer so please excuse my admittedly amateurish attempts to interpret what I've found.
BTCST involved the agreed transfer of control of owners' bitcoins to BTCST on the basis that an investment was being made between the owners and BTCST and BTCST issued paperwork to investors providing the details of the investment and their stake in it. As part of the SECs case against BTCST, a US Court has made a ruling that the transfers of bitcoins to BTCST and the purpose of those transfers constituted an investment which had properties that made it legally recognisable as such (and the Court also ruled that bitcoins were money as part of its legal argument for it being an investment). This opened up the feasibility of the SEC taking legal action against BTCST and it's officials for running an illegal investment vehicle since the SEC asserts that BTCST operated as a Ponzi scheme which is a criminal offence under US law. In its case against BTCST, I don't think that the SEC are particularly interested in who owns the bitcoins in question, they are more interested in those people who were investors in BTCST, as evidenced by their respective paperwork. So although the BTCTS case has said something about the financial value of bitcoins, I can't see that it has said very much about determining the ownership of them.
The Silk Road situation seems, among many things but of most relevance to theft of bitcoins, to revolve around bitcoins being held in escrow accounts which had been placed there by bitcoin owners. Unsurprisingly, because of Silk Road's anarcho-libertarian nature, these were unofficial escrow accounts rather than legally certified escrow accounts. Of course the point of any proper escrow account is that a 3rd party
controls the contents of the account strictly on behalf of the
owner(s) of the contents of the account in accordance with a legally binding escrow agreement and this should also apply to a properly supervised bitcoin escrow account. So the concept of escrow appears to set a general precedent that control does not necessarily equate to ownership.
But this doesn't quite fit with the traditional view of bitcoins from the point of view of the bitcoin protocol in which an (at least nominally anonymous) bitcoin account doesn't have an identified owner but simply has somebody who knows the private key for that account and thus controls it; implicit in the bitcoin protocol is the assumption that whoever controls a bitcoin account is the owner of the bitcoins within the account.
As I understand it, the legal case against Ulbricht actually relates to charges of drug trafficking and money laundering rather than to the theft of bitcoins but it has thrown up an interesting debate with regard to the FBI's apparent desire to gain access to Silk Road's bitcoin accounts and the possible use of a 5th amendment defence by Ulbricht to avoid disclosing any private keys that he may have for those accounts (
http://www.coindesk.com/silk-road-case-bitcoin-legal-precedent). I can't work out if:
# the FBI is already actively seeking to show that if Ulbricht is able to exercise control of the account then he is at least complicit in the use of the account for the activities he's charged with, regardless of who owns the bitcoins in the account (and possibly regardless of who else might be able to control the accounts).
# or whether Ulbricht's defence team are simply concerned that if he happens (or is forced to) show that he has the means to control the accounts, even if showing he can do so is for other purposes, that the FBI
may *subsequently* try to use it as evidence that he is complicit.
# or whether the FBI is wants or needs to show that Ulbricht actually
owns the bitcoins in the accounts and given the implicit entanglement of ownership and control within the bitcoin protocol, the only way they can do that is to show that he can control the accounts...unless he has documented proof that although he might be able to control the accounts, that somebody else actually owns the bitcoins in the accounts.
These are big fraud/theft cases featuring bitcoin but you run into the control versus ownership issue at a simpler level. For example, if you hold bitcoins in your account and I steal your private key and transfer the bitcoins to my account. The bitcoins that I now have are under my control, not yours; and even though it is easy to show that the coins came from your account, you would have to show that I had stolen your private key and used to transfer bitcoins to my account without your consent, I.e. that I had usurped the control of your account, and I think that's a much more difficult task than simply showing who is able to control a particular bitcoin account.
