0 sats \ 2 replies \ @Majjin OP 18 Apr 2022 \ parent \ on: The Justice System and Bitcoin Custody bitcoin
... Bitcoin is both a digital bearer asset that allows self custody and an open, decentralized, permissionless network, it is the first truly seizure resistant store of value.
... as Bitcoin adoption increases (true adoption, with users holding their own cryptographic keys), reliance on intermediaries will decrease. The linchpin of the civil justice system will slip.
To countervail Bitcoin’s seizure resistance, therefore, money judgments must be secured through a combination of: Decreased due process, and Increased coercion
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0 sats \ 1 reply \ @Majjin OP 18 Apr 2022
How does a plaintiff collect an asset, like bitcoin, that is held personally by a defendant, and which can be dissipated before judgment is granted? One way is to seize or freeze the defendant’s assets before they know a lawsuit has even been filed. This tactic poses a grave threat to due process as outlined in Amendment XIV of the U.S. Constitution, the right to notice and an opportunity to be heard before one’s property is seized.
But a civil justice system threatened by increasing adoption of an uncollectable asset will be incentivized to loosen such constraints.
... freezing assets is only the first half of the puzzle. The ultimate goal is to transfer the frozen assets from the judgment-debtor to the judgment-creditor after final judgment has been entered. This process is known as “enforcing the judgment.” But without an intermediary for the judgment-creditor to garnish, the bitcoin-holding judgment-debtor must be convinced — or coerced — into relinquishing their private keys to satisfy a money judgment.
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0 sats \ 0 replies \ @Majjin OP 18 Apr 2022
Preparing for the civil justice system’s proliferation of coercive in personem tools and pre-judgment deprivations of wealth requires a multi-layered approach.
The first layer is individual. As previously mentioned, individuals can reclaim due process by acquiring, holding and using bitcoin as privately as possible. Plaintiffs cannot freeze defendants’ assets if they don’t know about them.
The second layer is communal. The Bitcoin community as a whole needs to promote, foster and build a peer-to-peer circular economy. This will help Bitcoiners avoid gated on- and off-ramps like centralized exchanges, which can be co-opted to inform on defendants or freeze and seize assets.
This initial transition period of curtailed due process and increased coercion need not become the permanent state of affairs, however. Bitcoin’s disintermediation of the civil justice system presents a unique opportunity for society to create fairer and more humane systems of dispute resolution.
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