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Cryptocurrency has a pretty big problem: "dollars, but without US Government oversight" is exactly what money launderers and other financial criminals want to h

Cryptocurrency has a pretty big problem: "dollars, but without US Government oversight" is exactly what money launderers and other financial criminals want to have. The closer any cryptocurrency gets to being this, the more illegal activity it will facilitate and the more risk the project takes on of getting the entire operation seized and the principals arrested and extradited to the US (see also: Liberty Reserve).

SI_Rob 7y ago
This is not a problem (for the cryptocurrency "thought leaders" at least). It is literally the primary motivation for its existence. Look at the message embedded into the Bitcoin Genesis block - it's no secret that the entire point was to evade, undermine, and ideally supplant government control over issuance and circulation of money.
darawk 7y ago
You could equally say "Speech, but without US government oversight, is exactly what the pedophiles and terrorists want to have".
- ThrustVectoring 7y ago
  True. I'm not making a moral judgement here - merely stating that flouting anti-money-laundering laws and facilitating financial crimes has severe legal risks. I'm honestly not even worried that Facebook is going to flout AML laws. I'm more worried that they'll use the fact that they're using newfangled technology and the political and economic weight of their crypto consortium to get favorable legislation passed. And then, because of said crypto features, we'll end up undermining laws that fight money laundering and other financial crimes.
  - weddpros 7y ago
    "undermining laws that fight money laundering and other financial crimes": do these actually work? 5% of the time? 95%?
Solvitieg 7y ago
It's a problem only for the government and existing financial institutions. Looks no further than China.
- ThrustVectoring 7y ago
  Not really. Money laundering, extortion, and other financial crimes have negative externalities. It's absolutely a problem if we invent the technology that allows me to pay a crypto-ransom, since that pretty directly creates a bunch of ransomers. Also, the principals involved in "disrupting" governments and existing financial institutions also face the problem of government reprisal. Liberty Reserve got seized and their principals arrested and charged with various financial crimes.
  - solveit 7y ago
    > Also, the principals involved in "disrupting" governments and existing financial institutions also face the problem of government reprisal. Say what you will about Bitcoin, it's been remarkably successful on this front and I'm not exactly sure how.
    - tim333 7y ago
      Bitcoin was designed so there are no obvious principals to have reprisals against. Satoshi kept semi anonymous for a reason.
  - SomeOldThrow 7y ago
    The government already has these problems: look at the use of real estate to launder money. Eg https://www.washingtonpost.com/news/politics/wp/2018/01/04/how-money-laundering-works-in-real-estate https://www.washingtonpost.com/news/politics/wp/2018/01/04/h...
buboard 7y ago
It's not a bug it's a feature. Cryptocurrencies were invented by and promoted by libertarians from the beginning.
SomeOldThrow 7y ago
That’s not a problem with cryptocurrency, that’s a regime problem.

SI_Rob 7y ago

This is not a problem (for the cryptocurrency "thought leaders" at least). It is literally the primary motivation for its existence. Look at the message embedded into the Bitcoin Genesis block - it's no secret that the entire point was to evade, undermine, and ideally supplant government control over issuance and circulation of money.

darawk 7y ago

You could equally say "Speech, but without US government oversight, is exactly what the pedophiles and terrorists want to have".

ThrustVectoring 7y ago
True. I'm not making a moral judgement here - merely stating that flouting anti-money-laundering laws and facilitating financial crimes has severe legal risks. I'm honestly not even worried that Facebook is going to flout AML laws. I'm more worried that they'll use the fact that they're using newfangled technology and the political and economic weight of their crypto consortium to get favorable legislation passed. And then, because of said crypto features, we'll end up undermining laws that fight money laundering and other financial crimes.
- weddpros 7y ago
  "undermining laws that fight money laundering and other financial crimes": do these actually work? 5% of the time? 95%?

Solvitieg 7y ago

It's a problem only for the government and existing financial institutions. Looks no further than China.

ThrustVectoring 7y ago
Not really. Money laundering, extortion, and other financial crimes have negative externalities. It's absolutely a problem if we invent the technology that allows me to pay a crypto-ransom, since that pretty directly creates a bunch of ransomers. Also, the principals involved in "disrupting" governments and existing financial institutions also face the problem of government reprisal. Liberty Reserve got seized and their principals arrested and charged with various financial crimes.
- solveit 7y ago
  > Also, the principals involved in "disrupting" governments and existing financial institutions also face the problem of government reprisal. Say what you will about Bitcoin, it's been remarkably successful on this front and I'm not exactly sure how.
  - tim333 7y ago
    Bitcoin was designed so there are no obvious principals to have reprisals against. Satoshi kept semi anonymous for a reason.
- SomeOldThrow 7y ago
  The government already has these problems: look at the use of real estate to launder money. Eg https://www.washingtonpost.com/news/politics/wp/2018/01/04/how-money-laundering-works-in-real-estate https://www.washingtonpost.com/news/politics/wp/2018/01/04/h...

buboard 7y ago

It's not a bug it's a feature. Cryptocurrencies were invented by and promoted by libertarians from the beginning.

SomeOldThrow 7y ago

That’s not a problem with cryptocurrency, that’s a regime problem.