Digital Asset Recovery is possible on all blockchains

Contrary to popular belief, it is possible to recover blockchain-based digital assets.

The original blockchain, Bitcoin, was designed by Satoshi Nakamoto to comply with the law, including recycling coins and tokens.

While millions of victims of theft and fraud are unaware of digital asset recovery, it is possible. In this article I will explain how it is done and why it is important.

How digital asset recovery works on Bitcoin SV

Bitcoin SV (BSV) was the first blockchain to enable the recovery of digital assets, but it will not be the last. To learn how this is possible, it helps to understand the process. Here’s how it goes.

First, those who have lost coins or had them stolen must prove that they own them. This can be done by showing proof, such as purchase receipts. Once they have done so, they must obtain a court order or equivalent.

Then a notary will convert the court order into a machine-readable format and transmit it to the mining network. Miners at BSV run blacklist management software as an addition to their node software.

Miners then respond to the notary’s app and confirm that they have received the order. When enough miners have responded, the notary activates a consensus freeze order.

From this point on, honest nodes reject any attempt to spend coins on their frozen list.

Finally, an asset recovery tool can be used to reallocate misused or lost coins. Miners perform a transaction to send coins to their legally established owners. Miners who ignore such orders open themselves up to contempt and other legal claims and risk having their blocks orphaned, causing financial losses and potentially wiping out their investments.

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Why is digital asset recovery so important?

While some of an anarchist bent will repeat the mantra “not your keys, not your coins” without critical thought, the truth is obvious to anyone with common sense: taking someone’s coins does not make you their legal owner.

In truth, Satoshi Nakamoto always had the recovery of digital assets in mind, which is why he built a warning system into the first version of Bitcoin. Although it didn’t scale as he designed it, solutions could have been built, but instead misguided developers removed it in Satoshi’s absence, fundamentally changing the nature of his electronic cash system.

Still, the ability to recover digital assets is critical if Bitcoin and other blockchains are to gain the trust of both regulators and users. Why would a Fortune 500 or even a smaller company or individual keep assets on a blockchain knowing that if they are stolen there is nothing they can do?

Bitcoin was always designed to comply with the law, and coins/tokens are treated as property under it. This means that they are owned by people and entities, and despite what those who see Bitcoin as a tool for subverting the law say, ownership will apply to coins of all kinds.

Looking back, we can see that courts, regulators and those in power always have a period where they have to play catch-up when new technologies emerge and are quickly adopted. That period has arrived for blockchain technology, and you can bet your bottom dollar that property rights will apply when the ink dries on the laws they pass.

If blockchain technology is to reach its potential, transform every industry on earth and usher in a new era of transparency and prosperity, digital asset recovery will be necessary. Although only possible on BSV right now, digital asset recovery processes can be implemented on BTC and BCH and eventually will be.

Join us at the London Blockchain Conference

The largest blockchain technology conference in the world is going to take place in London this year between May 31st and June 2nd. We invite you to join us there to discuss how massively scalable blockchains will change the world, including by enabling the recovery of digital assets.

This is not strictly a BSV conference. Builders, entrepreneurs and thought leaders working with other blockchains are welcome as long as everything they do is legal. Although the promotion of illegal securities is not welcome at the conference, ideas, discussions and debate are from different perspectives.

Secure your ticket to the London Blockchain Conference today. What you see can only confuse you!

See: Digital Asset Recovery on Bitcoin Explained

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New to Bitcoin? Check out CoinGeeks Bitcoin for beginners section, the ultimate resource guide for learning more about Bitcoin – as originally envisioned by Satoshi Nakamoto – and blockchain.