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The prosecutor in Sweden had claimed in court that the guy should be deprived of his illegally acquired Bitcoin at the equal value in fiat currency at the time of his conviction.
The Swedish government has found itself in the unforeseen situation of paying out around $1.5 million worth of Bitcoin (BTC) to a convicted – and then jailed – drug dealer.
The individual was convicted in a Swedish court two years ago of illegally earning 36 Bitcoin through online narcotics transactions. Tove Kullberg, his prosecutor at the time, had utilised Bitcoin’s equivalent in fiat currency to prove her case. As a result, the court ruled that the guy should be stripped of his illegally obtained Bitcoin, which was worth 1.3 million Swedish kronor ($100,000) at the time.
The man’s crypto stockpile had valued so much in the months following his conviction and imprisonment that the Swedish Enforcement Authority, tasked with auctioning off the 36 BTC, only needed to sell off 3 BTC to fulfil the court’s demands.
That leaves 33 BTC, worth $1.5 million, that must be restored to their rightful owner. Kullberg told Swedish radio that the approach she chose to plead her case was “unfortunate in many ways […] It has led to ramifications I was unable to anticipate at the time.” She continued, saying:
“The lesson to be learned from this is to keep the value in Bitcoin, that the profit from the crime should be 36 Bitcoin, regardless of what value the Bitcoin has at the time.”
Kullberg also emphasised that as cryptocurrency becomes more generally used, prosecutors would be wise to invest in training their staff about the industry’s intricacies. “The more we enhance the degree of expertise throughout the organisation, the fewer errors we will make,” she explained.
Cryptocurrencies continue to pose legal authorities and procedures around the world, whether owing to their volatility or technical design. A government-sanctioned task committee in the United Kingdom recently proposed a dispute resolution framework that would assist standardise the means of dealing with smart contract conflicts. Due to the non-recognition of Bitcoin as legal tender or its surrogate, a Russian court last year ruled against restituting stolen crypto to the victim of a major crime.