The US Gov't Seizes 50,000 Bitcoin 😱
💡 Daily Reminder: Stay humble, stack sats
Bitcoiners,
Yesterday, the United States Department of Justice released a press release announcing law enforcement seized over 50,676 bitcoin worth over $3.36 billion dollars at the time in November 2021.
Here is an overview of the historic seizure so you can understand the risks involved with owning bitcoin without using privacy measures.
The News
In 2012, a man named Jimmy Zhong stole over 50,000 bitcoin from the popular dark web site Silk Road.
Zhong exploited a glitch in which he kept creating fake accounts on the website and requested to withdraw bitcoin to his personal addresses. The crime the US government convicted him of was not "providing any goods or services in return". From 2012-2021, Zhong held the bitcoin on a few devices wrapped up in blankets in his home. In 2021, the government traced the transactions using advanced analysis and figured out an IP address that belonged to Zhong. That IP address gave the government information about Zhong's home location and they eventually showed up and put him under arrest.
The government put Zhong in jail until he finally handed over his private keys to obtain the bitcoin on the previously confiscated hardware devices.
Significance
This historic event proves that every transaction on the bitcoin blockchain is carefully monitored by third parties including governments.
As an owner of bitcoin, you must understand these implications and practice bitcoin privacy practices if you want to keep your fortune. In a hyperbitcoinized world, there will be actors outside of government surveilling the bitcoin blockchain for easy targets. Don't make yourself an easy target. What is most interesting about this event, is that the government could not seize Zhong's bitcoin until they made him tell them the password to his private keys.
Bitcoin is the most seizure-resistant asset ever created.
Happy Tuesday,
-Pod
PS. I've been on a little hiatus without internet over the past few days in Mt. Zion National Park. Now back to regularly scheduled newsletters!
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Eric Podwojski
Founder, Bitcoin EDU
Twitter: @epodrulz
Disclaimer: This should go without saying: This is not financial advice. This is not investment advice. I write this newsletter for education and entertainment. Act accordingly.
