Canadian Authorities are Seeing Seizing Bitcoin is Easier Said than Done

By Cje95 | Chronic Illness and Crypto | 25 Mar 2022


During the weeks-long Freedom Convey that gridlocked Ottawa crypto and Bitcoin, in particular, were used to fundraise for the truck drivers. A pretty solid system was set up to do so and a total of roughly 20.7 BTC was collected. All was going well for the donations to flow and be passed along until Prime Minister of Canada Justin Trudeau used the Emergency Powers Act granting himself vast power to end the protest and also stop the flow of money to those protesting.

 

People were outraged to hear that Bitcoin had been seized and that a government could do that however looking at it from a technological perspective it made a ton of sense. In the US when the Colonial Pipeline attack occurred and the government ended up recovering almost all of what was paid people did not seem to blink an eye but that was because the Bitcoin was being transacted on US servers which allowed the government to step in and seize them. This is the same thing that Canada is doing however since it's against regular people and not some network of hackers it has gotten much more attention than it otherwise would have. 

 

Unlike when the American Government was able to recover the BTC Canada is learning that it can be a pretty hard and complicated process if you do not know what you are doing. See the issue arises from a silly but pretty vital thing..... the crypto addresses. The fundraiser had the money all sent to a multi-sig wallet which would then disperse the funds which makes a ton of sense. Well, 101 additional wallets were not only created but had 0.144 BTC put in each one. Based on what I have been able to find out these were paper wallets meaning once the information was created and passed off unless you had memorized it you were not going to recover it. 

 

So when the Ontario Supreme Court ordered that the multi-sig and 122 other wallet addresses freeze their funds the owners of the multi-sig however had no control over the remaining amount. This is how Canada ran into the issue of only freezing 5.9 BTC that remained. While the other addresses could be monitored it was not and has not been able to freeze them since they do not know any of the information and those that generated do not remember either! 

 

The only way that this currency could get seized then would be if Canadian servers were used to move it around and even then it would have to be intercepted. It could also be seized if someone sends the Bitcoin to their address in Canada and has done all of their paperwork so that the government knows who's wallet it is. Even with all of this, I get a chuckle out of seeing a government that tried to tamp down on something realize that they cannot impact or influence what they want to. The US government has awarded contracts to companies really to avoid this very issue and Canada it appears has not or just moved too slowly on the information when they received it. 

 

It will be interesting to see if any more get seized or if those paper wallets manage to move the funds quickly enough and outside of Canada to pull off the transaction. The BTC frozen will be interesting to watch too as I do not know if Canada can seize it or if now that the Act has been rescinded if this BTC ends up just being unfrozen. 

 

Please know I am not a financial advisor I am just someone who picked up on a trend and wanted to express it! Makes sure you always do your own research and never invest money you cannot afford to lose! If you enjoyed this article and would like to further support me below are a couple of referral links that if you used when signing up I would appreciate it! Also, follow me on Twitter @Cje95_

 

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Cje95
Cje95

Graduated from Texas A&M in May of 2020 had dabbled in crypto since 2017 but dove in at the end of 2019. December of 2020 packed up and moved to D.C.! Huge sports fan, space nerd, and international newsreader! Follow me on Twitter @Cje95_


Chronic Illness and Crypto
Chronic Illness and Crypto

Cryptocurrency and Blockchain are going to be a huge part of the future and no matter who tries it isn't going to be stopped! Here I try to give my best insight and thoughts into the latest crypto news, features, developments. Further, I look to discover any link to news from the United States ranging from social-political issues to stock market and economic data.

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