POSTED BY Kevin Tan
Bitcoin, a cryptocurrency, emerged in 2009 which gives its network participants the ability to make transactions free of any transactional fees that banks and credit card companies would usually require. Furthermore, using bitcoins for international purchases would not subject the parties to the country’s laws or to its regulations. The use of bitcoins has appealed to many small businesses and restaurants worldwide. There are also some established large firms that have accepted bitcoins such as Overstock.com, the Sacramento Kings, Zynga, and Virgin Galactic, among several others. Bitcoins can be bought and sold for many different currencies worldwide from individuals and companies alike.
Bitcoin users do not have to reveal their names. All that is needed is their account number. Because of this fact and the fact that all parties involved are not subject to the conventional transactional fees, to government regulation, or to its laws, Bitcoin users have used bitcoins for various criminal activities: money laundering, Ponzi schemes, purchasing stolen goods, guns, and drugs, among many others. Believing that most of these transactions were done on the server called the Silk Road, the FBI has stepped in by seizing nearly 30,000 bitcoins (currently valued at $25 million) from the server. Having found that these bitcoins were the proceeds of crime, District Judge Oetken announced for the forfeiture of these coins.
In his press release, United States District Attorney Bhara supported Oetken’s holding because it furthered the government’s role in taking out “the profit of crime and signal to those who would turn to the dark web for illicit activity.” Although the holding does support this view, it is very difficult to claim that all activities done on that server were illegal. It is still unclear what sorts of transactions were done here. Furthermore, the money that was left there were there at the end of the transaction- the government did not prove that these coins were to be used to commit a crime or to further a crime. The holding suggests that the government could take money from anyone so long as the money were from the proceeds of crime. This is equivalent to stating that the government could take money from girl scouts for selling their girl scout cookies to a drug dealer because the money obtained from the drug dealer were from the proceeds of selling drugs. This doesn’t sound right.