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Imagine I have recently been abducted by highly advanced and strangely opinionated aliens who provide me with unfathomably advanced technology on the condition that I undermine Bitcoin (the aliens are worried Elon Musk will discover their secret interstellar resort on Mars and also are quite fond of polar bears, to whom they bear an uncanny resemblance). Armed with this technology, which allows me to trivially break ECDSA and quickly calculate SHA-256 hashes, I now possess the capability of forging any otherwise valid transaction and could thus generate a transaction that shifts bitcoins from any arbitrary account to a different one. What would be my personal legal consequences if I generated a transaction sending Alice’s bitcoins to a third party, Bob? I haven’t signed any contracts, nor have I induced anyone to transfer me anything of value. I have simply announced to the world that Alice should pay Bob x bitcoins, and surprisingly the world has agreed despite her protestations. Am I criminally liable for theft or fraud? Does Alice have a civil cause against me? What about other network participants, whose investments will be devalued if people cease transacting in bitcoins because some intergalactically conspiring arriviste keeps creating cryptographically valid but unsolicited impromptu giveaways of their hard-earned e-dough.

Less floridly, what crimes, if any, have I committed if I cause third parties to follow their plainly stated rules in such a way as to either directly transfer or reduce the value of assets held by someone else without their consent? What about if I have the consent of the person whose assets I’m transferring (say, in a double-spend attack) and merely move the assets between my own accounts but intend to collapse faith in Bitcoin? Does decentralizing operations really decentralize liability to the point of unenforceability? I’m particularly interested in the answer for legal systems in small tropical islands that would fight extradition in exchange for a sizable bribe (next up after possible bitcoin misappropriation is definite bank misappropriation - in for a penny, in for a pound!), but would nevertheless appreciate answers based in US, UK, or other common law-based legal systems (European and Louisianan law is confusing to me and I try to limit my illegalities in civil law jurisdictions to Bourbon Street and its environs only).

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Theft

You have taken Alice’s property with the intention of permanently depriving him of it - that’s theft. The fact that you didn’t appropriate it for yourself is irrelevant.

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  • But how did Bob (actually I think you mean Alice) gain title of the bitcoin, if say she mined them?
    – Dave
    Apr 15 at 7:44
  • The same way Nickel miners get title to the Nickel they mine - by working for it.
    – Dale M
    Apr 15 at 9:47
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    It is really not the same way. Legal rights over mineral extraction are defined in a lot of legislation, including international law (and it has more to do with having guns than doing work). The application of maths and lots of electricity to solve "problems" does not have this body of law.
    – Dave
    Apr 15 at 9:58

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