US Strategic Reserve; is it right to actually use seized assets as reserves

[jackpotmaster]

A "seized asset" implies something that was stolen by criminals from their victims.

No, there are many other scenarios where this is not true.

In that case the seized asset should be given back to the victims.

In many cases this is near impossible or does not make economic sense. Should they spend $100m in taxes to track down, account and reimburse victims $10m in value? No.

The government has no right to hold on to it or sell it off for its own benefit.

Of course they do. The law decides the right, not someone with the username headingnorth.

If so then that would give government a perverse incentive to falsely accuse you of stealing
and provide them an excuse to seize your bitcoin (even when you legitimately own it and never stole anything).

You've been asleep since you have been born. Did you complain that asset seizure is possible with other assets before or you are just complaining about Bitcoin now? This incentive was always there, and it will always be here.

[Antotena]

Anything seized becomes the property of the government and they have to decide what they want to do with it. If they have a place in their constitution that specifies what seized assets will be used for then they should follow their rule of law. If you're looking from the moral angle then you can argue that the US government did not directly buy the seized cryptocurrency so they shouldn't keep it in their reserve. But others can raise a counter argument that immediately the coins were seized they automatically becomes a US property and they can choose to keep it. Anyway we don't know if the government has a timeframe to offload the seized coins in the near future, we'll wait and see.

This is wrong though, if a coin is seized then it means the person that received the coin the first place did it illegally but I want believe that the coin has an origin, why not send back the coin to the original owner. I can't imagine someone coin was hack and lose everything they have fault for only for another country to hold into it. The only coins that government is supposed to keep is only when someone use it for terrorism or use to trade illegal goods.

I remember how silk road Bitcoin was sieze years back, he even went for prison for it because it was reported that the Bitcoin in his possession were gotten under the influence of dark web and any activities on dark web is illegal, he was later pardon but all the Bitcoin was taking by the government which was understandable, he got back though because people still donate some Bitcoin for him after his release, that's one power message of a decentralized community.

[jackpotmaster]

This is wrong though, if a coin is seized then it means the person that received the coin the first place did it illegally but I want believe that the coin has an origin, why not send back the coin to the original owner. I can't imagine someone coin was hack and lose everything they have fault for only for another country to hold into it. The only coins that government is supposed to keep is only when someone use it for terrorism or use to trade illegal goods.

I remember how silk road Bitcoin was sieze years back, he even went for prison for it because it was reported that the Bitcoin in his possession were gotten under the influence of dark web and any activities on dark web is illegal, he was later pardon but all the Bitcoin was taking by the government which was understandable, he got back though because people still donate some Bitcoin for him after his release, that's one power message of a decentralized community.

Your own example contradicts you. In cases like dark web markets, the users are using the coin for illegal purposes and the sellers are getting coin for illegal things. In both these cases there is reason to return the coin to anyone, so it should be seized and go towards the government. For other cases like scams I have explained it in my post.

In that case the seized asset should be given back to the victims.

In many cases this is near impossible or does not make economic sense. Should they spend $100m in taxes to track down, account and reimburse victims $10m in value? No.

[headingnorth]

The government has no right to hold on to it or sell it off for its own benefit.

Of course they do. The law decides the right, not someone with the username headingnorth.

It's sad and scary to know there are so many sheep like yourself who think the government can do whatever it wants,
and no one should ever dare question them. That is the anti-thesis of what bitcoin is about and why it was created. 

Someone like yourself would feel right at home in North Korea or Saudi Arabia. I wouldn't be surprised if you are from one those places.

[avp2306]

Anything seized becomes the property of the government and they have to decide what they want to do with it. If they have a place in their constitution that specifies what seized assets will be used for then they should follow their rule of law. If you're looking from the moral angle then you can argue that the US government did not directly buy the seized cryptocurrency so they shouldn't keep it in their reserve. But others can raise a counter argument that immediately the coins were seized they automatically becomes a US property and they can choose to keep it. Anyway we don't know if the government has a timeframe to offload the seized coins in the near future, we'll wait and see.

This is wrong though, if a coin is seized then it means the person that received the coin the first place did it illegally but I want believe that the coin has an origin, why not send back the coin to the original owner. I can't imagine someone coin was hack and lose everything they have fault for only for another country to hold into it. The only coins that government is supposed to keep is only when someone use it for terrorism or use to trade illegal goods.

I remember how silk road Bitcoin was sieze years back, he even went for prison for it because it was reported that the Bitcoin in his possession were gotten under the influence of dark web and any activities on dark web is illegal, he was later pardon but all the Bitcoin was taking by the government which was understandable, he got back though because people still donate some Bitcoin for him after his release, that's one power message of a decentralized community.

Since it was been seized that means those coins are came from illegal activities.

You will learn lot of things about those seizures they made here https://cryptonews.com/news/story-behind-us-governments-5-billion-bitcoin-heres-what-you-need-know/

Also US didn't seize those coins immediately since they undergo with lots of process. Much better if they seize those coins since somehow its helpful for them, also that's their law and part of consequences to those which did criminal activities in their jurisdiction since this serves as a warning that never do any financial crimes and terrorism in US.

[lionheart78]

My question is; is this actually right? I think this assets are supposed to auction or sold off?

I think, there is nowhere that states a seized asset cannot be a reserve.  As far as I know, it was misunderstood that seized assets need to be auctioned since the previous assets that were confiscated from criminal activities are auctioned, but there is nowhere in the law or guidelines that these seized assets are not fit for reserve.  They had these seized assets from hacks and other criminal activities auctioned to recover costs or fund some programs.

With this I believe it is ok for the seized Bitcoin to be a Bitcoin reserve since there is no law forbidding it.

Does Not buying bitcoin actually signifies that they don’t believe in bitcoin at all and are only fulfilling campaign promises.

I think they are just being smart.  Why sell seized Bitcoin when they can just put it in reserve?  It is illogical if they already have Bitcoin and sell it then buy again for their Bitcoin reserve.

[jackpotmaster]

The government has no right to hold on to it or sell it off for its own benefit.

Of course they do. The law decides the right, not someone with the username headingnorth.

It's sad and scary to know there are so many sheep like yourself who think the government can do whatever it wants,
and no one should ever dare question them. That is the anti-thesis of what bitcoin is about and why it was created.  

Someone like yourself would feel right at home in North Korea or Saudi Arabia. I wouldn't be surprised if you are from one those places.

What is right in a country is decided by law. Whether you like this or not changes nothing. In your case, the majority of the stupid decides what is allowed and what is not.   My man wants the government to give back money to drug addicts and drug sellers, great example of western education.  

[Orpichukwu]

In that case the seized asset should be given back to the victims. The government has no right to
hold on to it or sell it off for its own benefit.

They can give it back to the right owners; that's if they know who it belongs to or if it's in a case where the owners are clean and can come forward to challenge the government in court and prove they own something in those seized coins. Then they can receive it back, but if they can't do that, then it will come down to selling it in auction, or they will later be left to decide what to do with it.

[headingnorth]

The government has no right to hold on to it or sell it off for its own benefit.

Of course they do. The law decides the right, not someone with the username headingnorth.

It's sad and scary to know there are so many sheep like yourself who think the government can do whatever it wants,
and no one should ever dare question them. That is the anti-thesis of what bitcoin is about and why it was created.  

Someone like yourself would feel right at home in North Korea or Saudi Arabia. I wouldn't be surprised if you are from one those places.

What is right in a country is decided by law. Whether you like this or not changes nothing. In your case, the majority of the stupid decides what is allowed and what is not.   My man wants the government to give back money to drug addicts and drug sellers, great example of western education.  

Giving back money to drug addicts would greatly benefit crackheads like yourself,
so why are you complaining? You get free govt money to buy more crack and meth!

In that case the seized asset should be given back to the victims. The government has no right to
hold on to it or sell it off for its own benefit.

They can give it back to the right owners; that's if they know who it belongs to or if it's in a case where the owners are clean and can come forward to challenge the government in court and prove they own something in those seized coins. Then they can receive it back, but if they can't do that, then it will come down to selling it in auction, or they will later be left to decide what to do with it.

The US government can't even account for its own bitcoin holdings that were seized from various sources including Silk Road.
About 150,000 bitcoins are still unaccounted for. They have never provided proof of funds (ie: public addresses) for the missing amount.
They have never provided a proper explanation of what happened to it.

The US government also hasn't conducted an audit of its gold holdings in over 50 years.

I would not trust them to hold anything of value in a strategic reserve for long. It will eventually get embezzled.

[Lucius]

~snip~
Even though this is not bitcoin but is this the new method of which US are trying build their own reserve by holding siezed assets
My question is; is this actually right? I think this assets are supposed to auction or sold off?
Does Not buying bitcoin actually signifies that they don’t believe in bitcoin at all and are only fulfilling campaign promises.

If you would search my post history, I'm sure you would find a post in which I wrote my opinion about US crypto reserves based on exactly what you are writing about now. While people were excited that the US would buy BTC, some like me warned that they would fill their reserves this way.

After all, why buy when you can get it for free - who can complain about anything, they make and enforce the laws - and all those who keep their coins in CEXs wallets are no longer only at risk from hackers, but also from the authorities who can always say "your coins are seized because they are connected to crimes, terrorism and money laundering".

[collecttmaster]

~snip~
Even though this is not bitcoin but is this the new method of which US are trying build their own reserve by holding siezed assets
My question is; is this actually right? I think this assets are supposed to auction or sold off?
Does Not buying bitcoin actually signifies that they don’t believe in bitcoin at all and are only fulfilling campaign promises.

If you would search my post history, I'm sure you would find a post in which I wrote my opinion about US crypto reserves based on exactly what you are writing about now. While people were excited that the US would buy BTC, some like me warned that they would fill their reserves this way.

After all, why buy when you can get it for free - who can complain about anything, they make and enforce the laws - and all those who keep their coins in CEXs wallets are no longer only at risk from hackers, but also from the authorities who can always say "your coins are seized because they are connected to crimes, terrorism and money laundering".

This was always the case though, so nothing new. Instead of seizing to sell, they seize to keep. The risk was always present, people were just ignoring it. The not your keys not your coins lesson comes one way or the other. If a person can't learn by reading, they will learn by losing.

[fuguebtc]

I am quit confused, where is the seized bitcoin from? Because it will hurt if the Bitcoin was seized from an exchange hacker or similar, it means that some people will be affected.

I expect the government to return the Bitcoin to the rightful owners, unless they can't find the rightful owners again, also some Bitcoin that are seized from criminals might be impossible to return to the owners, these are the type they should keep.

Now if they decide to keep doing this it will give the government the power to start seizing Bitcoin to increase their holding, because it's free, they will do it the right and the wrong ways, I am not in support of this crazy strategy, it feels like stealing to me.

The US has stockpiled seized crypto in a Strategic Bitcoin Reserve & authorities plan to rely on the captured assets rather than make open market purchases.  Even transfers in recent years ($300k) were flagged by Arkham into government wallets as op already mentioned. The US Marshals tend to auction off historically seized BTC, however reporting of FOIA shows that holdings/accounting are sloppy & estimates differ widely. It is absolutely legal but also shady at the same time. Look out for perverse incentives, demand transparency and audits bruh.

[Lucius]

This was always the case though, so nothing new. Instead of seizing to sell, they seize to keep. The risk was always present, people were just ignoring it. The not your keys not your coins lesson comes one way or the other. If a person can't learn by reading, they will learn by losing.

It's incredible that even after 15 years since the existence of Bitcoin, a lot of those who own Bitcoin have not learned anything, so they still think that CEXs are some kind of bank where you can store (in a safe way) your cryptocurrencies and nothing bad can happen. Will people ever understand that no government in the world will accept Bitcoin for what it actually is, but rather they accept it by changing its purpose?

It will probably never happen, but as the old saying goes, "While I breathe, I hope"

[avp2306]

This was always the case though, so nothing new. Instead of seizing to sell, they seize to keep. The risk was always present, people were just ignoring it. The not your keys not your coins lesson comes one way or the other. If a person can't learn by reading, they will learn by losing.

It's incredible that even after 15 years since the existence of Bitcoin, a lot of those who own Bitcoin have not learned anything, so they still think that CEXs are some kind of bank where you can store (in a safe way) your cryptocurrencies and nothing bad can happen. Will people ever understand that no government in the world will accept Bitcoin for what it actually is, but rather they accept it by changing its purpose?

It will probably never happen, but as the old saying goes, "While I breathe, I hope"

People are actually aware of this but actually lots of people are lazy to transfer to those wallets which they have control. Since what they think its waste of time to do transfer when they want to trade their asset. They are so confident that nothing will happen on the CEX's they are using.

They only realize that they made huge mistake once they are affected with not only hacking issue but also government seizing those what they think illicit funds came from the exchange they capture.

Hopefully fully realize those mistakes they have done and don't give their full trust on CEX's even if they are what they called reputable platform.

 

[Ronsbit]

If you ask people who lost their money, I guess they would be pissed if the government didn't spend any effort on returning their money. But I think it's hard from a logistical perspective to make sure every penny is returned to its rightful owner. I suppose whether it's the right thing to do is impossible to answer, unless we know they're trying to seize money by labeling every business as illegal and forcing their way into it. The thing we can do as a retail user is to make sure we don't lose our money due to stupid mistakes.

I agree with your opinion as it relates to sensitive matters as this. These assets seized by the US government can be returned back to the owners if the government really wants to do so because majority of the seized bitcoin are said to be from hacks which means it could be traceable to the exchanged that got hacked to return it back to the owners but from all indications, the government wants to hold onto it by using the law to back them up for their actions. This is the more reasons why we should be extremely careful so we do not get into situations as this where our assets can not be returned back to us after being taken back from hackers and scammers by the government and we hoping that the government would do the needful be helping to return backto the owners.

[Swordsoffreedom]

I agree with your opinion as it relates to sensitive matters as this. These assets seized by the US government can be returned back to the owners if the government really wants to do so because majority of the seized bitcoin are said to be from hacks which means it could be traceable to the exchanged that got hacked to return it back to the owners but from all indications, the government wants to hold onto it by using the law to back them up for their actions. This is the more reasons why we should be extremely careful so we do not get into situations as this where our assets can not be returned back to us after being taken back from hackers and scammers by the government and we hoping that the government would do the needful be helping to return backto the owners.

It is true that the government can return it to the owners if they want, they will find a way. But did you know that finding the real owner will be costly and time consuming, even more costly than the amount of money seized?

It is easier said than done, and we cannot blame the government in this case when the fault lies entirely with us for failing to control our greed or being too careless in protecting our personal property.
Furthermore, the government has billions of problems to solve at home and abroad, and we cannot expect them to spend all their manpower and time just to refund us.

Between choosing to address other issues like diplomacy, improving infrastructure, attracting foreign investment to create millions of jobs for the people versus spending time just compensating a few thousand people for their negligence. Which do you think is more important?

[Ronsbit]

I agree with your opinion as it relates to sensitive matters as this. These assets seized by the US government can be returned back to the owners if the government really wants to do so because majority of the seized bitcoin are said to be from hacks which means it could be traceable to the exchanged that got hacked to return it back to the owners but from all indications, the government wants to hold onto it by using the law to back them up for their actions. This is the more reasons why we should be extremely careful so we do not get into situations as this where our assets can not be returned back to us after being taken back from hackers and scammers by the government and we hoping that the government would do the needful be helping to return backto the owners.

It is true that the government can return it to the owners if they want, they will find a way. But did you know that finding the real owner will be costly and time consuming, even more costly than the amount of money seized?

It is easier said than done, and we cannot blame the government in this case when the fault lies entirely with us for failing to control our greed or being too careless in protecting our personal property.
Furthermore, the government has billions of problems to solve at home and abroad, and we cannot expect them to spend all their manpower and time just to refund us.

Between choosing to address other issues like diplomacy, improving infrastructure, attracting foreign investment to create millions of jobs for the people versus spending time just compensating a few thousand people for their negligence. Which do you think is more important?

Indeed we can not blame the government as they have lots of things to be doing in further development and also providing necessities and amenities for her citizens and of course we know  that in most cases also, it would be more expensive to get those funds returned back to the owners but I think that of the exchange would not be an issue as the exchange already have details and names of accounts that got affected by the hack and also they have their customers KYCed so that would  be much easier to trace if they really want to make sure they return the assets back to the owners as the government can collaborate with the exchange to making sure the assets gets to the owners. In all, we just have to be more careful and put our assets under our own custody as third party exchange can not guarantee the the safety of our assets.

[collecttmaster]

It's incredible that even after 15 years since the existence of Bitcoin, a lot of those who own Bitcoin have not learned anything, so they still think that CEXs are some kind of bank where you can store (in a safe way) your cryptocurrencies and nothing bad can happen. Will people ever understand that no government in the world will accept Bitcoin for what it actually is, but rather they accept it by changing its purpose?

It will probably never happen, but as the old saying goes, "While I breathe, I hope"

It is really crazy to me. It seems that the problem never was about access to information, the problem was in the people.

People are actually aware of this but actually lots of people are lazy to transfer to those wallets which they have control. Since what they think its waste of time to do transfer when they want to trade their asset. They are so confident that nothing will happen on the CEX's they are using.

It has nothing to do with laziness. You are aware that a car hitting you will possibly kill you, but you are lazy so you don't dodge it? Nah, you got things backwards. If you understand the danger of something fully, you act accordingly with this knowledge. Until your acts change, you understand nothing.

I agree with your opinion as it relates to sensitive matters as this. These assets seized by the US government can be returned back to the owners if the government really wants to do so because majority of the seized bitcoin are said to be from hacks which means it could be traceable to the exchanged that got hacked to return it back to the owners but from all indications, the government wants to hold onto it by using the law to back them up for their actions. This is the more reasons why we should be extremely careful so we do not get into situations as this where our assets can not be returned back to us after being taken back from hackers and scammers by the government and we hoping that the government would do the needful be helping to return backto the owners.

It is not worth the effort, so they will not try to return it to the few owners that may have had legitimate ownership.

[InvoKing]

Just days after The US Treasury secretary Scott Bessent announced that the country which is actually setting up a bitcoin strategic reserve is not looking to buy bitcoin. With the intent of actually keeping the 200k bitcoin which is heavily reported to seized bitcoins in their possession as reserve.

Just after that a blockchain analytics platform Arkham reported that $300k value of coins have been moved to the government account from coinbase and it was reported to be siezed from an Hacker


Even though this is not bitcoin but is this the new method of which US are trying build their own reserve by holding siezed assets

My question is; is this actually right? I think this assets are supposed to auction or sold off?

Does Not buying bitcoin actually signifies that they don’t believe in bitcoin at all and are only fulfilling campaign promises.

Moral in this world do not exist anymore and doing horrible stuff is always justified by bad people.
Centuries ago piracy was taking place in the land then in the sea then in the internet. No one can blame the government and the judges are being silenced and Supreme Court was chosen carefully to be theirs. Good luck trying to prove the government wrong.