There, fixed that for you.
I read an article today with the headline “Police seize $60 million of bitcoin! Now, where's the password?” If they don’t know the password, have they really seized all that Bitcoin? My answer is: no.
A man in Germany fraudulently stole around 1700 Bitcoin from people by surreptitiously installing software on other people’s computers, causing them to mine for him. After he was caught, he was sentenced to over two years in jail. The police, who think they have confiscated his Bitcoin, can’t access the coins because the fraudster won’t give them the password. They are unsure if he’s just silent about the matter, or if he doesn’t know the password.
However, without access to the password, the police can’t really say that they’ve seized the Bitcoin. It’s possible that the crook who stole the Bitcoin in the first place still has access to the coins (although the article says prosecutors have ensured he can’t). If the police can’t access to them, how are they so sure that he can’t?
I’m not saying that the crook does or does not have the ability to get at these coins, but it’s possible that he does. For example: let’s say that he made a copy of his private keys and stored them in a safe location unknown to the police. Even if the police seize his hardware, as long as they cannot access the wallet and can’t move the coins to another address, the fraudster still could (although if he did, there’d be a record on the blockchain).
Using other people’s computers to mine cryptocurrency is wrong, of course, but perhaps this case is a good reminder to have a backup of your cryptocurrency somewhere, especially if you have large amounts. What if your house burns down or something happens to your computer? I have a backup of my cryptocurrency located in a safe out of state. While not everybody can do this, if you have large amounts of crypto, it might be a good idea to have a backup—somewhere. Somewhere where other people won’t have access to it, of course. Because your cryptocurrency can’t actually be seized (or stolen) unless someone gets their hands on your private keys.
