4 ms·

How does it defeat the $5 wrench?

by fleitz 10y ago

livingparadox 10y ago
Given that the previous comment is referring to state actors, you have the courts to defeat the 5$ wrench. For more direct criminal elements, you can make it difficult enough that its not worth them going through the effort to use the 5$ wrench and wait while you have to fetch the key. Beyond that, you're no worse off than you were versus carrying cash. The only thing electronic cards might have advantage over this is many provide fraud protection which will refund/void fraudulent charges.
- fleitz 10y ago
  Ok, so you're in court, and the courts just gonna be like, 'ok, we'll just ignore our orders to make you pay because it's crypto currency'? I don't think you understand what happens when you defy court orders... Also, mostly this will be used for tax issues, where guess what, the burden is on you to prove that your income was only X, so the more crypto shit you have the easier it is for the prosecution to say you have millions in crypto currency. You really think ZCash is the first company to think of hiding assets from the gov't?
  - bryondowd 10y ago
    The point seems to be that the court would actually have to order you to release the funds, as opposed to the current case where law enforcement can seize physical funds without a court order, putting the burden on you to get it back if the seizure wasn't justified. The court reference you replied to is saying that the court system protects you from having a state actor use force to take your property before you've had your day in court. ETA: That said, I don't think you need anonymity for this, so it would apply to any currency you can use as cash and secure with a password. I guess the anonymity just makes it more like physical cash in that nobody can track how much or where you spend/receive it. For tax purposes, it would be no different from cash in terms of ability to work under the table and be called on it or accused of it by the IRS.
  - livingparadox 10y ago
    Your question was how do you defeat the 5$ wrench, not how do you tell them tax-man to f himself. If state actors use the 5$ wrench, that's illegal and consequently you have the defense of the courts to counter that behavior. Civil forfeiture is dependent on being able to "prosecute" your stuff, rather than you. So if they can't seize it, they have to go after you directly, which puts the burden of proof on the prosecution to demonstrate that the money is unlawfully possessed. The fundamental principle of the US court system is "innocent until proven guilty", so you don't have to prove what your income is, they have to prove it. You only need to counter their claims.
    - ac29 10y ago
      > Civil forfeiture is dependent on being able to "prosecute" your stuff, rather than you. So if they can't seize it, they have to go after you directly. The US certainly has had cases prosecuting "stuff" where said stuff is cryptocurrency. See "United States v. 178.95842915 Bitcoins" [0], which appears to be a civil forfeiture case [1][2]. [0] https://www.usmarshals.gov/assets/2016/bitcoinauction/index.html https://www.usmarshals.gov/assets/2016/bitcoinauction/index.... [1] https://www.pacermonitor.com/public/case/10752506/United_States_of_America_v_17895842915_Bitcoins https://www.pacermonitor.com/public/case/10752506/United_Sta... [2] https://docs.justia.com/cases/federal/district-courts/washington/waedce/4:2016cv05017/71480/16 https://docs.justia.com/cases/federal/district-courts/washin...
      - livingparadox 10y ago
        To prosecute your stuff, they still have to confirm its existence. You don't have to prove it doesn't exist.
  - stale2002 10y ago
    How do they actually know that you have millions though? Imagine the opposite scenario. The government thinks you have millions, but you genuinely do NOT have that money. How do you prove to the government that you are innocent and don't actually have the money. You can't. You, an innocent person, are indistinguishable from a person who actually DOES have millions hidden away in crytocurrency.
    - bryondowd 10y ago
      Well, this only holds so far as you live like someone who doesn't have millions hidden away. It would be difficult to turn this hidden currency into an appreciable lifestyle improvement in a way that wouldn't be observable and result in an audit that could prove that your observed expenditures exceed your claimed resources. At best, you could make a bunch of minor improvements that aren't easily observed.
nickff 10y ago
It depends on what you mean by 'the $5 wrench', but anonymous cryptocurrency would allow the victim to deny or misstate their account balance. It would not protect a victim being slowly tortured to death (a situation for which I cannot imagine a protection), but would protect the victim in situations where the attacker had limited means.
- livingparadox 10y ago
  He's most likely referring to this XKCD comic: https://xkcd.com/538/ https://xkcd.com/538/
seansoutpost 10y ago
Multisignature wallets mean that you can beat the credentials out of a person and still not be able to access the coins. You would have to figure out who else had keys and beat then too. Raising the difficulty a non-trivial level.
- vkou 10y ago
  For the wallet to be useful, the person you are beating will either know who else needs to be beaten, can be compelled to withdraw their funds under duress, or in the case of a centralized counterparty, like a bank, can be trivially compelled by a government bearing a lawful order, to sign off on a money transfer. If none of those means of getting you to pay work out, they can always leave you to enjoy your internet money in jail.
  - stale2002 10y ago
    The issue is that they have no idea how much money you 'actually' have. If someone threatens you with a wrench, you simply do what they ask you to do and provide a password to your "account" that conveniently doesnt have much money in it. "yes officer! I have done exactly what you asked me to do. Here is all the electronic money that I own. "
- st3v3r 10y ago
  Ok, but how does that protect ME from that $5 wrench?
  - abrkn 10y ago
    You can setup a hardware wallet with plausible deniability[1] [1] https://www.reddit.com/r/TREZOR/comments/2e8a9i/can_someone_provide_a_stepbystep_tut_to_set_up/ https://www.reddit.com/r/TREZOR/comments/2e8a9i/can_someone_...
    - st3v3r 10y ago
      And then they beat me with the wrench anyway for wasting their time. But I suppose the money's ok, which I'll need for hospital bills.

How does it defeat the $5 wrench?

by fleitz 10y ago

How does it defeat the $5 wrench?

Given that the previous comment is referring to state actors, you have the courts to defeat the 5$ wrench. For more direct criminal elements, you can make it difficult enough that its not worth them going through the effort to use the 5$ wrench and wait while you have to fetch the key. Beyond that, you're no worse off than you were versus carrying cash. The only thing electronic cards might have advantage over this is many provide fraud protection which will refund/void fraudulent charges.

fleitz 10y ago
Ok, so you're in court, and the courts just gonna be like, 'ok, we'll just ignore our orders to make you pay because it's crypto currency'? I don't think you understand what happens when you defy court orders... Also, mostly this will be used for tax issues, where guess what, the burden is on you to prove that your income was only X, so the more crypto shit you have the easier it is for the prosecution to say you have millions in crypto currency. You really think ZCash is the first company to think of hiding assets from the gov't?
- bryondowd 10y ago
  The point seems to be that the court would actually have to order you to release the funds, as opposed to the current case where law enforcement can seize physical funds without a court order, putting the burden on you to get it back if the seizure wasn't justified. The court reference you replied to is saying that the court system protects you from having a state actor use force to take your property before you've had your day in court. ETA: That said, I don't think you need anonymity for this, so it would apply to any currency you can use as cash and secure with a password. I guess the anonymity just makes it more like physical cash in that nobody can track how much or where you spend/receive it. For tax purposes, it would be no different from cash in terms of ability to work under the table and be called on it or accused of it by the IRS.
- livingparadox 10y ago
  Your question was how do you defeat the 5$ wrench, not how do you tell them tax-man to f himself. If state actors use the 5$ wrench, that's illegal and consequently you have the defense of the courts to counter that behavior. Civil forfeiture is dependent on being able to "prosecute" your stuff, rather than you. So if they can't seize it, they have to go after you directly, which puts the burden of proof on the prosecution to demonstrate that the money is unlawfully possessed. The fundamental principle of the US court system is "innocent until proven guilty", so you don't have to prove what your income is, they have to prove it. You only need to counter their claims.
  - ac29 10y ago
    > Civil forfeiture is dependent on being able to "prosecute" your stuff, rather than you. So if they can't seize it, they have to go after you directly. The US certainly has had cases prosecuting "stuff" where said stuff is cryptocurrency. See "United States v. 178.95842915 Bitcoins" [0], which appears to be a civil forfeiture case [1][2]. [0] https://www.usmarshals.gov/assets/2016/bitcoinauction/index.html https://www.usmarshals.gov/assets/2016/bitcoinauction/index.... [1] https://www.pacermonitor.com/public/case/10752506/United_States_of_America_v_17895842915_Bitcoins https://www.pacermonitor.com/public/case/10752506/United_Sta... [2] https://docs.justia.com/cases/federal/district-courts/washington/waedce/4:2016cv05017/71480/16 https://docs.justia.com/cases/federal/district-courts/washin...
    - livingparadox 10y ago
      To prosecute your stuff, they still have to confirm its existence. You don't have to prove it doesn't exist.
- stale2002 10y ago
  How do they actually know that you have millions though? Imagine the opposite scenario. The government thinks you have millions, but you genuinely do NOT have that money. How do you prove to the government that you are innocent and don't actually have the money. You can't. You, an innocent person, are indistinguishable from a person who actually DOES have millions hidden away in crytocurrency.
  - bryondowd 10y ago
    Well, this only holds so far as you live like someone who doesn't have millions hidden away. It would be difficult to turn this hidden currency into an appreciable lifestyle improvement in a way that wouldn't be observable and result in an audit that could prove that your observed expenditures exceed your claimed resources. At best, you could make a bunch of minor improvements that aren't easily observed.

nickff 10y ago

It depends on what you mean by 'the $5 wrench', but anonymous cryptocurrency would allow the victim to deny or misstate their account balance. It would not protect a victim being slowly tortured to death (a situation for which I cannot imagine a protection), but would protect the victim in situations where the attacker had limited means.

livingparadox 10y ago
He's most likely referring to this XKCD comic: https://xkcd.com/538/ https://xkcd.com/538/

seansoutpost 10y ago

Multisignature wallets mean that you can beat the credentials out of a person and still not be able to access the coins. You would have to figure out who else had keys and beat then too. Raising the difficulty a non-trivial level.

vkou 10y ago
For the wallet to be useful, the person you are beating will either know who else needs to be beaten, can be compelled to withdraw their funds under duress, or in the case of a centralized counterparty, like a bank, can be trivially compelled by a government bearing a lawful order, to sign off on a money transfer. If none of those means of getting you to pay work out, they can always leave you to enjoy your internet money in jail.
- stale2002 10y ago
  The issue is that they have no idea how much money you 'actually' have. If someone threatens you with a wrench, you simply do what they ask you to do and provide a password to your "account" that conveniently doesnt have much money in it. "yes officer! I have done exactly what you asked me to do. Here is all the electronic money that I own. "
st3v3r 10y ago
Ok, but how does that protect ME from that $5 wrench?
- abrkn 10y ago
  You can setup a hardware wallet with plausible deniability[1] [1] https://www.reddit.com/r/TREZOR/comments/2e8a9i/can_someone_provide_a_stepbystep_tut_to_set_up/ https://www.reddit.com/r/TREZOR/comments/2e8a9i/can_someone_...
  - st3v3r 10y ago
    And then they beat me with the wrench anyway for wasting their time. But I suppose the money's ok, which I'll need for hospital bills.