[rarw]

The current valuation is irrelivant. Federal seizure laws allow the government to seize any property, money or bitcoins included, that were used in or generated from some illegal activity.

If my illegal activity generates 1 bitcoin which, 2.5 years later is worth 10 bitcoins, all 10 bitcoins can be seized since they all originated from the original seizable piece of property.

Were this not the case and only the orignial result of an illegal transaction could be seized those running illegal operations would be able to profit from their crimes by simply converting one type of property into another that could increase in value. For example, if you sold 20,000,000 in drugs and purchased 20,000,000 in stock, it does not make sense that, once your property is seized, you can keep the increase in value between when you broke the law and when you got caught. This would make crime much more profitable which is the opposite goal of the seizure laws.

[Dylan16807]

So if I have both legal and illegal income, I should use the legal income on stock and the illegal income on my mortgage? Interesting side-effect.

[nmeofthestate]

I doubt paying into a mortgage is a cast-iron method of money laundering.

[rarw]

You're right. The comment that you should buy stock with legal income and pay back a mortgage with the illegal income misses the point completely. Buying stock was just one example of how transfering illegaly acquired funds into something that increases in value does not protect your initial investment. Anything you do with illegal income would be seizable property.

Paying into a mortgage as the same effect. As you pay back a mortgage you acquire equity in the property. The government would then be able to seize your equity in the house, meaning they could sell the property and after paying back the remainder of the mortgage keep the difference.

[Dylan16807]

That's not the point I was making. Let's say I put 1 million dollars into stock, and it grows to 1.1 million. At the same time I have a mortgage on a .7 million dollar house, with total payments of 1 million.

In this case I much prefer them to take the house, because it's significantly less valuable.

I wasn't suggesting any kind of money laundering.