Stolen fund alert system?

[bytemaster]

I imagine it could be a property of a balance that says transfers from this account are subject to self-destruction for 24 hours.  It would discourage thieves, but as a thief once you have the private key you might as well attempt it because you have already done the work to get the key in the first place.

[Agent86]

Ok, I'm well aware that this idea would be controversial.  I'm basically just throwing it out there.  I don't claim it's fully fleshed out or that we must do something like this, but I want to get people thinking and see any feedback.

Basically if you control a wallet, any transaction out of that wallet within the last 24hrs you can mark as a fraudulent transaction.  Everyone can distinguish funds that have been marked as fraudulent and most likely not accept them.  To make sure you are not doing business with someone trying to give you stolen funds for any large transaction you can demand that you only accept funds coming from an address that has held those funds at least 24hrs… these are "seasoned funds".  Exchanges can also demand that only funds that have been held in the sending address 24hrs prior to sending to the exchange are immediately available, otherwise they are quarantined 24hrs.

You could have a blockchain explorer app on your phone that alerts you anytime funds move out of any of your designated addresses.

Marking funds as stolen won't get you the funds back but will make it much more difficult for a thief to get a payday; so I would imagine there is little reason to do it unless it was a legitimate theft.  Anyone who is in control of funds that have been marked stolen can come forward to give an explanation and appeal to the community to have the designation removed.   There would be a process whereby the community can vote to remove the designation, otherwise after one year the stolen funds are burned as dividends (you could do without the auto burn while people get used to idea).  There's not necessarily a high burden of proof to have the designation removed but it forces someone to come forward and the party who marked them stolen has a chance to respond.

You could also have some kind of consensus community fund tagging.  For instance if Somali pirates or other demand BTSX for a ransom the community could vote to attach an alert to those funds even after 24hrs has expired but hopefully before there is a good chance for the criminal to liquidate.