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The US has blacklisted digital currency addresses for three Chinese nationals
- prepend 7y agoIn case you were as interested as I was in what it means to have your bitcoin address blacklisted, the coinbase [0] describes it to mean that anyone transacting with these addresses is subject to criminal prosecution and up to $1.1M per offense. It seems like it would just mean that any transactions on those wallets and downstream are a big felony US case. I would like to read the article of what happens. [0] https://www.coindesk.com/us-treasury-blacklists-bitcoin-litecoin-addresses-of-chinese-drug-kingpins https://www.coindesk.com/us-treasury-blacklists-bitcoin-lite...
- tinus_hn 7y agoSo just transfer the money to a new address? They are free.
- prepend 7y agoAccording to the article doing that would subject the recipient to prosecution. So any transfer is a big deal all the way to ground. So any new address would get tainted.
- sarcasmatwork 7y agoSure, but how would they know or enforce it? Creating a new address is free and can be anonymous. It does not have to be btc either. >The latest action reinforces how serious US officials are about cracking down on the use of cryptocurrency for money laundering How is that working out? They cant stop this from happening to the US dollar, how the heck do they think they will accomplish this with crypto?
- prepend 7y agoI don’t think it’s foolproof as this is a US agency. But I think it means that any reputable exchanges won’t be able to ever accept a transaction from any wallet that has ever touched these blacklisted wallets. So even 10,000 transactions downstream exchanges won’t be able to receive any funds. It’s kind of like if a stolen dollar bill was marked forever. Any bank would not be able to accept that dollar. And this agency will investigate anyone holding that dollar.
- chillacy 7y agoSince every transaction is public you can trace the flow of funds like a graph traversal.
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- tinus_hn 7y agoYou can create your own new address and transfer the money yourself to yourself. The US government can’t stop that. And they probably can’t expect everyone to track the history of every bitcoin they receive.
- gnode 7y agoI can imagine it being problematic that crypto-currencies like Bitcoin don't require the recipient's consent to make them party to a transaction. Additionally, interaction with payment channel networks like Lightning may implicate innocent users in money laundering.
- prepend 7y agoI agree. That’s part of why I want to see how this goes down. It could end up being nothing. Or it could end up in many different crazy and interesting ways. It’s a spin on the Brewster’s Millions type problem. Lots of money to spend with particular restrictions.
- olliej 7y agoOk, ignoring anything else, how would this be enforced? How many intermediate addresses+transactions would be needed to make that work? Especially with the various exchanges where you could bounce between currencies.
- BubRoss 7y agoYou could taint any famous or high value address you want while also exchanging for different currencies. If you use a mixer, everyone else using the mixer would be tainted too. It's a nonsense solution, but an interesting attempt.
- BubRoss 7y agoI think this is actually great. Not because of any direct result, because there probably won't be much. If the government is blacklisting addresses it legitimizes cryptocurrencies and shows some investment in applying existing laws to them. They could just send transactions to any exchange that isn't up to date with the ban and get another currency all together, so it seems moot, but the intention is interesting.