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It's relatively easy to identify mixers, so by sending money to a mixer you immediately flag your sending account as high risk...

by tempsy 7y ago

jandrese 7y ago
More importantly receiving money from a mixer could taint your wallet for converting the bitcoins into real money. KYC laws kick in. It's easy to check if you've ever had coins from a mixer enter your wallet. The idea that your transactions are mixed up and impossible to track doesn't matter so much if they just assume everybody who uses a mixer is a criminal.
- __s 7y ago
  You can't reject someone depositing to your address. So a tumbler can taint whichever addresses it pleases You aren't tracking coins with the ledger, only totals. So address A can have 10 btc, tumbler adds 5 to A, then A transfers 5 to B, 5 to C. If C is an exchange, does it consider that A is still holding 5 tumbled coins? Or does it say B has the tumbled coins? Or does it reject A's offer of 5? Feel free to shift values such as A having 100 BTC, receiving 0.01 tumbled BTC, & wanting to send 1 BTC to exchange Also hard to track something like A sending tumbled coins to B, which triggers the owner of B to have C send non tumbled coins to D. You can even have this service offered at an exchange rate, so D receives less than B did
  - jandrese 7y ago
    Easiest solution is to just taint any wallet that has ever had a coin from a known tumbler added to it. It's harsh and a malicious tumbler could mess up famous wallets, but easy to implement and "safe" to a point. A harder solution only allows them to withdraw up to the number of coins you can verify were not tumbled. So if some malicious tumbler deposits 0.000001 coin in your wallet you can convert all but 0.000001 of your wallet's value at an exchange.
steveeq1 7y ago
You get around that by converting from btc to monero and then back again. Either through bisq or through xmr.to. "mixers" are obsolete now because it's a central point of failure.
- dragontamer 7y ago
  Will monero just be consider a money laundering scheme by the FBI in the future? Why use monero unless you wanted to hide your transactions? Hiding your transactions is literally illegal in the USA (its called money laundering). Presumably, the FBI will be able to automatically determine if your BTC came from a Monero exchange.
  - steveeq1 7y ago
    Hackers use "bisq" which is a decentralized exchange to get around this problem. I am baffled as to how "kingpin money launders" don't do this. I'm not a money launderer and I know this. As for the fbi consdering monero a "money laundering scheme" in the future. They can outlaw it, I guess, but it's like trying to outlaw video and music piracy, it's hard to do in practice.
    - dragontamer 7y ago
      > Hackers use "bisq" which is a decentralized exchange to get around this problem. How does "bisq" provide anonymity to its users? If you're trading BTC, your wallets are still being connected to each other and provably written into the blockchain for all of eternity. Same with Ethereum and other "mainstream" cryptocoins. If the FBI only cares about "anonymous" coins, like Monero, and ONLY targets those, then all payment processors would "taint" Monero wallets (or any BTC coins which ever touched a Monero-related wallet), and refuse to process them. Its really not that hard for Monero (or any other minority-coin) to be shut out of the payment processor market and relegated to black-market goods.
      - steveeq1 7y ago
        Because there are legimitate uses for monero and if you use a service like xmr.to to convert to bitcoin (which mixes the bitcoin on top of that), you are "far enough removed" from the tainted transaction to establish "plausible deniability".

It's relatively easy to identify mixers, so by sending money to a mixer you immediately flag your sending account as high risk...

by tempsy 7y ago

It's relatively easy to identify mixers, so by sending money to a mixer you immediately flag your sending account as high risk...

jandrese 7y ago

More importantly receiving money from a mixer could taint your wallet for converting the bitcoins into real money. KYC laws kick in. It's easy to check if you've ever had coins from a mixer enter your wallet. The idea that your transactions are mixed up and impossible to track doesn't matter so much if they just assume everybody who uses a mixer is a criminal.

__s 7y ago
You can't reject someone depositing to your address. So a tumbler can taint whichever addresses it pleases You aren't tracking coins with the ledger, only totals. So address A can have 10 btc, tumbler adds 5 to A, then A transfers 5 to B, 5 to C. If C is an exchange, does it consider that A is still holding 5 tumbled coins? Or does it say B has the tumbled coins? Or does it reject A's offer of 5? Feel free to shift values such as A having 100 BTC, receiving 0.01 tumbled BTC, & wanting to send 1 BTC to exchange Also hard to track something like A sending tumbled coins to B, which triggers the owner of B to have C send non tumbled coins to D. You can even have this service offered at an exchange rate, so D receives less than B did
- jandrese 7y ago
  Easiest solution is to just taint any wallet that has ever had a coin from a known tumbler added to it. It's harsh and a malicious tumbler could mess up famous wallets, but easy to implement and "safe" to a point. A harder solution only allows them to withdraw up to the number of coins you can verify were not tumbled. So if some malicious tumbler deposits 0.000001 coin in your wallet you can convert all but 0.000001 of your wallet's value at an exchange.

steveeq1 7y ago

You get around that by converting from btc to monero and then back again. Either through bisq or through xmr.to. "mixers" are obsolete now because it's a central point of failure.

dragontamer 7y ago
Will monero just be consider a money laundering scheme by the FBI in the future? Why use monero unless you wanted to hide your transactions? Hiding your transactions is literally illegal in the USA (its called money laundering). Presumably, the FBI will be able to automatically determine if your BTC came from a Monero exchange.
- steveeq1 7y ago
  Hackers use "bisq" which is a decentralized exchange to get around this problem. I am baffled as to how "kingpin money launders" don't do this. I'm not a money launderer and I know this. As for the fbi consdering monero a "money laundering scheme" in the future. They can outlaw it, I guess, but it's like trying to outlaw video and music piracy, it's hard to do in practice.
  - dragontamer 7y ago
    > Hackers use "bisq" which is a decentralized exchange to get around this problem. How does "bisq" provide anonymity to its users? If you're trading BTC, your wallets are still being connected to each other and provably written into the blockchain for all of eternity. Same with Ethereum and other "mainstream" cryptocoins. If the FBI only cares about "anonymous" coins, like Monero, and ONLY targets those, then all payment processors would "taint" Monero wallets (or any BTC coins which ever touched a Monero-related wallet), and refuse to process them. Its really not that hard for Monero (or any other minority-coin) to be shut out of the payment processor market and relegated to black-market goods.
    - steveeq1 7y ago
      Because there are legimitate uses for monero and if you use a service like xmr.to to convert to bitcoin (which mixes the bitcoin on top of that), you are "far enough removed" from the tainted transaction to establish "plausible deniability".