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Bitcoin News

A roundup of the top Bitcoin news from July 5 to July 11.

Friday, July 5

• Bitcoin Foundation Responds to California: Respectfully, You’re Wrong

Sunday, July 8

• In Bitcoin First, DEA Seizes Bitcoin Citing Controlled Substances Act

Tuesday, July 9

• Bitcoin Foundation Appoints Jon Matonis as Executive Director

Wednesday, July 10 

• Inside Bitcoins Conference Adds Virtual Currency Regulatory Panel

Thursday, July 11

• Kipochi Launches Africa’s First Bitcoin Wallet in Kenya

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In a first for alternative currency Bitcoin, the Drug Enforcement Administration (DEA) has seized Bitcoin from an American. Eric Daniel Hughes of South Carolina was forced to forfeit 11.02 Bitcoins, or $814.22 at the time of seizure, pursuant to 21 U.S.C. § 881, which prohibits property to be used or acquired as a result of a violation of the Controlled Substances Act (21 U.S.C. §§ 801 et seq.).

LetsTalkBitcoin was the first to break this news and link to the official DEA notification, which reads:

DISTRICT OF SOUTH CAROLINA
13-DEA-581051, 11.02 Bitcoins, Acct.#1ETDwGUC1QcjYuehFr3u1FD3MvDaUs7SFy,
VL: $814.22 which was seized in Charleston, SC from Eric Daniel Hughes AKA Casey Jones on April 12, 2013

LetsTalkBitcoin explained that the DEA likely lured Hughes into an illicit transaction on a website such as Silk Road.

The Bitcoin address referenced in the complaint recieved a transaction for 11.02btc at 17:10:36 Blockchain time on the date noted as “seized”.  This could mean that either the DEA took control of a computer with an unencrypted wallet and transferred the amount to a DEA controlled wallet, or more likely that this was not an in-person confiscation at all.   This could be an illicit “Silk Road” transaction, where US authorities set up a “honeypot” selling account, and accepted the 11.02btc as payment.

As for how the DEA tracked down Hughes, well, considering that his username on Silk Road was Casey Jones, anyone who listens to The Grateful Dead could have had some suspicions about Hughes’ profession.

CC image by Images_of_Money

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