I had assumed that they had some kind of obtuse M of N scheme with no sufficient number of parties in the same place at once, but that was perhaps too optimistic (?) of me.
That's can be pulled off, but actually requires planning and forethought to pull off. For instance, you'd want the keys to be on HSMs/hardware wallets in different jurisdictions (ideally rivals like US and Russia). Obviously this wasn't something they considered or planned for considering many (most?) of the higher ups were living in a shared penthouse in the Bahamas. Although, to be fair I don't fault them for not planning for this. If things get bad enough that men with guns are demanding you to do something, being able to reject their request would be pretty low on my list of priorities.
Armed government agents show up to your door asking you for half a billion dollars. You tell them "can't do it, I need this other key that's held by my partner in a different place". What do you think is going to happen next? "Understandable, have a good day" and they go home? Or they hold you in jail until you somehow find a way to comply?
but that's the very purpose of such schemes, to render you unable to comply.
if such an event happens in a more or less civilized country, you might eventually get some third party to confirm that you're unable to disclose the key
Absolutely the latter. My surprise comes more from FTX seemingly not even trying to do some kind of key protection scheme; it seems as though they made it easy for this seizure to happen. To my mind, this speaks large volumes about the quantity of misplaced confidence in these firms.
They made it easy to move the funds around on purpose, so that they could move the funds around any time they wanted. "They" being a very small handful of people, maybe just SBF himself, maybe a couple others. They didn't want it to be hard to move funds because that would require more accountability. Accountability was the last thing they wanted.
And how would you ever comply? The government can hold you hostage, but absent the consent of your collaborators there’s nothing you or the government can do. Which is not a great situation to be in, to be fair.
The government can let you call your collaborators. While they torture you. Of course you picked your partners carefully to be absolute psychopaths that would rather see you suffer and die than give up their keys. That's how you picked them as trustworthy partners in the first place!
