[hparadiz]

Crypto can be used as a store of wealth when crossing borders preventing search and seizure of your wealth against overzealous governments. See Russia in the early 90s which would regularly search and confiscate cash from people leaving. That alone makes it very valuable.

[Larrikin]

What's the scenario where the government can take the digital money from your bank accounts but can't take the digital money from your crypto wallet?

[DennisP]

Any scenario where you're sufficiently careful with your private keys.

[rounce]

What happens when they bust out the $5 wrench?

[fallingsquirrel]

They would need 300 million wrenches, one for each citizen. That leaves society in a much better position than letting them do it at scale with an sql query.

[rounce]

Are wrenches single-use, or are you allocating individual attackers per-citizen? In the case of a successful wrench attacker, how are the stolen funds recovered?

[fallingsquirrel]

This is the classic time-money tradeoff. Theoretically you only need one wrench and one attacker—but even if she attacks 100 people a day it would take thousands of years to reach everyone. And word of the attacks would spread, so later victims would take steps to safeguard their money and the attacks would become ineffective.

To be maximally effective you'd need to mobilize enough attackers and enough windowless white vans to reach the entire populace within probably a day, so let's say 3 million attackers and 3 million white vans. That's when things start getting more expensive than the sql query.

[kragen]

You give them one of your three seed phrases.

[tivert]

> What's the scenario where the government can take the digital money from your bank accounts but can't take the digital money from your crypto wallet?

In cryptocurrency's defense (I am not a Bitcoiner), it not as easy for them to do that, because they can't just order a bank to transfer it/freeze it....assuming the owner is going through a lot of elaborate, inconvenient, and easy to footgun security measures. If you have a Coinbase wallet you're in exactly the same situation as if you had cash in the bank.

HOWEVER, the cost people pay to get that is stupidly high. For every suave international drug dealer who's kept their money out of the hands of the evil government with Bitcoin, you probably have 1,000 dudes or more, who lost the keys to their wallet somehow or got their Bitcoin stolen in a hack.

So you probably shouldn't be worrying to much about duh gubbament.

And then, the obligatory xkcd about crypto: https://xkcd.com/538/ / https://arstechnica.com/security/2024/09/forget-hacking-this....

[fallingsquirrel]

These threads always leave me baffled. Some people say that only drug dealers use bitcoin. Others say the ratio of normal dudes to drug dealers is 1,000:1 or more. I guess it depends what sounds convenient at the time.

[tivert]

If you worry about the government seizing your money like that, you really should be someone whose money the government wants to seize [1]. Those people aren't regular dude software engineers.

[1] Also, keeping your money in a bank account almost certainly product you from those controversial civil forfeiture situations.

[Thorrez]

I think the argument is that the drug dealers are actually using bitcoin for its utility, whereas the 1000 normal dudes are just buying it as an investment, not to use.

[dowager_dan99]

if you replace "investment" with "speculation" I agree

[RGamma]

By head count maybe, but by value you gotta include the ransomware gangs, gambling rings, weapons dealers, human traffickers, money launderers, etc. too. And then it's probably not 1000:1 anymore.

[nicky0]

Government cannot take money from a crypto wallet because of cryptography. They could only do it if they compelled you to hand over your secret keys against your will. They also may not even know you have a crypto wallet since it is not registered in your name and is very easy to hide.

On the other hand, government can sieze funds from your bank account by seeking a court order or whatever legal instrument is needed in your jurisdiction.

[freefaler]

Exactly, and that's why in EU a transaction to a self-custody wallet from an exchange you need to declare that wallet as your own. Then when the government want to seize your BTC they can track from that wallet onwards all transactions.

The problem with crypto as a hedge against government overreach is with fiat exchanges. I hope more businesses start accepting crypto and you won't need to go trough an exchange that often.

[t0bia_s]

You can use cash to buy BTC in bitcoinmat. If you want anonymity while buying it on public place, use mask.

[multjoy]

What they can do is (in England & Wales, for example) is to impose a confiscation order on you so when you do end up liquidating your easily traceable crypto current, they will simply come after those assets.

[mistrial9]

no, while you are typing, there are senior finance legislators that are reviewing multi-hundred page reports where "the only legal way to trade is with a licensed broker" i.e. you Joe Citizen cannot hold your own keys. If you have not heard of this, welcome to old news in the USA and elsewhere. This is not fringe or conspiracy at all.. this is lawyers in the backroom for the last year(s).

[jliptzin]

When they don't know the crypto wallet exists?

[Larrikin]

There is no scenario where the government doesn't know it exist and the Bitcoin is useful in any way to your life. If you ever use it for any thing there's a bright line directly to you. The silk road guy was taken down for screwing up one time years before he even started the website. Maybe a criminal organization that forces their grand children into it can potentially hide a wallet.

[tim333]

The silk road guy pretty much had a government department trying to shut him down. They don't have the resources to do that for the average individual.

[tmottabr]

yeah, but that was more then 10 years ago..

i bet the analysis for that is all automated by now and built into their systems, making it much easier to go after the average individual.

[kragen]

It's true that bank accounts are relatively secure from seizure when crossing borders, but literally everybody I know here in Argentina who's my age or older lost three quarters of the savings in their bank accounts 23 years ago, because the government took it by converting dollars to pesos at the 1:1 pegged exchange rate and then dropping the peg. In a cryptocurrency wallet (a real one, not an exchange like Mt.Gox, Coinbase, or Binance) they wouldn't have lost anything.

Another case is when a foreign government puts you on a sanctions list and freezes your assets in the banks under their jurisdiction. This has happened to a lot of Russians and Russian companies in the last few years. (It also happened to the foreign reserves of the Russian central bank, but Bitcoin is not liquid enough to be a significant international reserve asset.)

Another case is when the government suspects you of some kind of wrongdoing but can't physically find you, or can find you but for whatever reason isn't willing to torture you. For example, two and a half years ago, some truckers in Canada staged a protest for misguided reasons, and the Canadian government of Justin Trudeau froze not only the truckers' bank accounts, and the organizers' bank accounts, but even bank accounts suspected to belong to people who were suspected of donating to the protest: https://www.cato.org/blog/emergencies-act-after-two-years https://www.newsweek.com/banks-have-begun-freezing-accounts-... https://nationalpost.com/news/politics/bureaucrats-who-froze...

> In freezing the bank accounts of Freedom Convoy protesters, Finance Canada bureaucrats said they did not intend to hurt protesters’ families’ ability to buy groceries or pay child support, though they admitted that may have ultimately happened, the Emergencies Act inquiry heard Thursday. (...) Two weeks ago, some Freedom Convoy organizers testified their spouses were cut off from their money and couldn’t make vehicle payments or purchase groceries and medication because joint bank accounts were frozen.

Earlier this year, a court found that the government's actions at the time were illegal. https://freespeechunion.org/trudeau-government-not-justified... explains:

> In pursuing this novel form of politically motivated financial censorship, Prime Minister Trudeau was following in the footsteps of Russian President Vladmir Putin, who in 2019 ordered his government to freeze bank accounts linked to opposition politician Alexei Navalny.

And of course it's well known that, when Wikileaks was targeted by the US government for their journalism, Visa and Mastercard cut off their donations despite apparently having no legal requirement to do so, while Bitcoin donations were able to continue. This was crucial in enabling Wikileaks to support Snowden's escape from the US when he revealed the extent of the US's illegal spying on its own citizens.

[kerbs]

You made a subtle, but important, pivot from the topic of “Bitcoin” to the broader topic of “crypto”.

Bitcoin specifically, with its multi-trillion dollar market cap, is built up that high purely on speculation. It is a very fragile store of wealth, especially the higher its market cap becomes.