What Is A Bitcoin 6102 Attack, And Is It Likely?

Ninety years ago, Roosevelt confiscated Americans' gold. Could the same happen for bitcoin one day?

Are the government likely to confiscate your coins?

In 1933, as America struggled in the grip of the Great Depression, President Franklin D. Roosevelt signed Executive Order 6102. This required all individuals, partnerships, associations, and corporations to deliver all gold coins, bullion, and certificates they owned to the Federal Reserve by May 1, 1933. The Fed bought the gold at $20.67 per ounce.

Executive Order 6102 effectively prohibited private ownership of gold in the United States. Now, some Bitcoiners are asking, could the same happen for them?

The Background Of Executive Order 6102

The main aims behind Roosevelt's order were to combat deflation, stabilize the economy, and increase the money supply. During the Great Depression, there was a severe shortage of currency in circulation. The US was on the gold standard, which meant that the value of the dollar was tied to a fixed amount of gold. By confiscating gold, Roosevelt aimed to increase the amount of gold held by the government, which would allow the Federal Reserve to expand the money supply by issuing more currency backed by gold.

The Executive Order was controversial and faced legal challenges, but ultimately it was upheld by the Supreme Court in United States v. Bankers Trust Co. (1935). Violating the order was punishable by fines and imprisonment.

Following the confiscation, the US government then set the price of gold at $35 per ounce, effectively devaluing the dollar and leading to a significant increase in the value of gold held by the government. This move also paved the way for the eventual abandonment of the gold standard in 1971, under President Richard Nixon, as the US transitioned to a fiat currency system where the value of the dollar was not tied to a specific amount of gold.

Could The Government "6102" Bitcoin?

There are concerns in the crypto space that one day the US government might attempt the same with bitcoin as it did with gold back in 1933.

While this would potentially always be a concern, the rise of ETFs make it far easier and more attractive to appropriate bitcoin—presumably force-selling citizens' holdings for the market price, and leaving them with depreciating fiat (which has likely just been printed). The catalyst could be another economic depression, potentially one for which crypto was blamed, as it grows and plays a more important part in the financial system.

Like Roosevelt's move against gold, confiscating citizens' bitcoins would be met with legal challenges. Additionally, while gold is relatively easy to seize once you know where it is, bitcoin can be self-custodied easily and, if care is taken, it is difficult to tie an address to its real-world owner. Against this, increasingly strict KYC helps the authorities identify wallets and track who owns what, making it easier to come after citizens who hold BTC. Potentially, laws against self-custody (no doubt enacted in the name of anti-money laundering and counter-terrorism concerns) would be put in place first to aid this process, funneling more money into ETFs rather than user-controlled wallets.

The good news is that, right now, the US seems to have no desire to appropriate citizens' bitcoins. In fact, they're only too happy to auction off ones they have seized from criminals, dumping them for fiat as quickly as they can. The first bitcoin auctions were held by the US government in 2014, and they are still auctioning off coins almost ten years later. This does not speak to a long-term vision to hold BTC.

Ultimately, no matter what the risk of a 6102-type order, self-custody should be the goal for most people who have the technical savvy to do it safely. Not your keys, not your coins.

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