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Is it theft if you steal the loot from a thief?

I would say it depends on how you look at it. You could say that the cryptos held by the U.S. government likely come mostly from seizures from criminals or potentially criminal individuals. But let me put it this way: I don’t feel sorry for them, and I hope the hacker succeeds in getting away with their haul.
 
Now he is sending it all back smi(&%

https://platform.arkhamintelligence.com/explorer/entity/usg

usgov.webp
 
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We can base the answer off of Rothbard's Ethics of Liberty. Rothbard argues that taxation is a form of "legalized theft" because it relies on coercion and not any voluntary consent; there is no such thing as a "social contract" as defined by some left-wingers. As the government has no legitimate claim to the wealth it extorts, taking assets back from the state can just be an act of restitution. Rothbard asserts that reclaiming property that was initially taken through force doesn’t equate to "theft" but rather corrects an earlier injustice.
 
We can base the answer off of Rothbard's Ethics of Liberty. Rothbard argues that taxation is a form of "legalized theft" because it relies on coercion and not any voluntary consent; there is no such thing as a "social contract" as defined by some left-wingers. As the government has no legitimate claim to the wealth it extorts, taking assets back from the state can just be an act of restitution. Rothbard asserts that reclaiming property that was initially taken through force doesn’t equate to "theft" but rather corrects an earlier injustice.
You nailed it.

I suggest to read https://a.co/d/hzqC1s2
“The state” is not the “society”. Nock teaches us that the state’s primary function is to seize wealth and redistribute it for its own purposes.