Because all Bitcoin transactions, including theft, are traceable. It is possible for law enforcement to track them as stolen property. As such, cryptocurrencies like bitcoin that have a black market history may continue to be passed about through transactions, but eventually, once they make their way to an exchange or something else that makes them locatable, they may be seized. Meaning, you might have received bitcoins in a perfectly legal transaction that are still marked from a history you are not aware of.
We propose a validation system before a transaction takes place in which the currency to be sent can be flagged as being as having an illegal history that may subject them to seizure.
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