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Money laundering in traditional finance is a problem of scale: there's far too much of it and we don't police it well enough. The problem is tractable given eno

Money laundering in traditional finance is a problem of scale: there's far too much of it and we don't police it well enough. The problem is tractable given enough enforcement tools and resources. Bitcoin's different - it has little AML control so it's super easy to write money laundering tools. Monero is even worse. Money laundering is built into the protocol, to the point where being able to determine the chain-of-custody over some funds is computationally infeasible. Cryptocurrency is designed to increase the scope of money laundering rather than just the scale, because it makes money laundering the default. Think about how difficult it was to enforce copyright law in 1970 versus 2010. In the former, copyright enforcement was a matter of having enough lawyers to sue enough enterprises. In 2010, everyone has a commercial-scale copyright infringement device in their pocket. You practically can't enforce the law to the same level purely because the targets are too small and numerous and going after them is a PR nightmare. This is why the music industry fought against consumer-grade recording technology for so long (and lost). Regulating large businesses is a fundamentally more tractable form of law enforcement than individuals.

chii 6y ago
> Monero is even worse. Money laundering is built into the protocol, to the point where being able to determine the chain-of-custody over some funds is computationally infeasible. Cryptocurrency is designed to increase the scope of money laundering rather than just the scale, because it makes money laundering the default. I would replace 'money laundering' with privacy and anonymity. These properties are desirable. These properties give the individual undertaking the transaction a semblance of control. These properties prevent authorities from taking that control away except by using the law, which i think is a fairly good way to enforce control. So if the individual feel that the law is unfair, they have the option to _not_ obey. If enough people choose to _not_ obey, it forces the court's hand and legislator's hand - this serves society. Under centralized control, the individual does not have the option to not obey, because their transactions require approval from authorities. This approval becomes a chilling effect for change, and it makes it easy to target them before the general society is able to transition or understand. Civil disobedience is thus impossible under centralized control.
- kls 6y ago
  Right I had to explain this to someone last time this subject came up. Illegal != immoral, take for example the Jews in Nazi Germany because it's required by the internet to invoke Nazis :) . Anyways, had cryptocurrencies existed when the some Jews were trying to escape Germany, and had those Jews moved their assets into crypto it would have certainly been illegal but that does not mean it would have been immoral. There are quite a few people in which anonymous funds not trackable by the government lends to their moral cause, though that cause may very well be illegal in their country.

chii 6y ago

> Monero is even worse. Money laundering is built into the protocol, to the point where being able to determine the chain-of-custody over some funds is computationally infeasible. Cryptocurrency is designed to increase the scope of money laundering rather than just the scale, because it makes money laundering the default. I would replace 'money laundering' with privacy and anonymity. These properties are desirable. These properties give the individual undertaking the transaction a semblance of control. These properties prevent authorities from taking that control away except by using the law, which i think is a fairly good way to enforce control. So if the individual feel that the law is unfair, they have the option to _not_ obey. If enough people choose to _not_ obey, it forces the court's hand and legislator's hand - this serves society. Under centralized control, the individual does not have the option to not obey, because their transactions require approval from authorities. This approval becomes a chilling effect for change, and it makes it easy to target them before the general society is able to transition or understand. Civil disobedience is thus impossible under centralized control.

kls 6y ago
Right I had to explain this to someone last time this subject came up. Illegal != immoral, take for example the Jews in Nazi Germany because it's required by the internet to invoke Nazis :) . Anyways, had cryptocurrencies existed when the some Jews were trying to escape Germany, and had those Jews moved their assets into crypto it would have certainly been illegal but that does not mean it would have been immoral. There are quite a few people in which anonymous funds not trackable by the government lends to their moral cause, though that cause may very well be illegal in their country.