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Despite the snark in the thread title, Sen. Chuck Schumer draws a reasonable conclusion. Bitcoin, despite its various other uses, theoretically can be used for

Despite the snark in the thread title, Sen. Chuck Schumer draws a reasonable conclusion. Bitcoin, despite its various other uses, theoretically can be used for money laundering.

9ec4c12949a4f3 15y ago
It absolutely is being used for money laundering right now.
sliverstorm 15y ago
I think the odds are if Sen. Chuck Schumer can conceive that Bitcoins can be used for money laundering, other folks have thought of the exact same thing. I.E. it is already being actively used to launder money.
- lizzard 15y ago
  I would think that online poker players or other gamblers figured this out a while back.
  - yangez 15y ago
    Contrary to popular belief and government propaganda, online poker players aren't any more likely to launder money than you are. Back to the article, like another poster said, how is a bitcoin-based drug site any different in terms of anonymity than a cash-based one if you have to give your address out at the end anyway?
    - doyoulikeworms 15y ago
      Mailing cash is scary and risky. Using Bitcoin doesn't remove the risk of fraud, but it removes the risk of your payment being lost/intercepted.
    - hnsmurf 15y ago
      The winners are highly likely to evade taxes but have no need to launder. Money laundering is unnecessary because online gambling proceeds aren't illegal in most states, and even where they are the Silver Platter doctrine and the fact that AGs don't prosecute customers generally makes it not worth while. I played poker for a living in a state where it is illegal to do so and still just claimed taxes legally (which is unusual for a poker player).
    - sliverstorm 15y ago
      any different in terms of anonymity The idea, in theory, is that the use of BitCoins cannot be tracked by a third party. That is to say, Silk Road, you and your dealer are the only ones who know about the purchase. In theory all three of you do not keep records of the sale, unlike credit card companies, which keep records of EVERYTHING.
- hnsmurf 15y ago
  I get the impression that the supply and utility of Bitcoin are both still far too low to be used for serious money laundering. Laundering isn't particularly difficult anyway. You're probably still just better off buying a bar and pouring vodka down the drain.
  - feydr 15y ago
    uhhh... check your math bro -- as of this moment there are 6,453,450 BTC in existence -- and you can buy them for $18.24 a piece leading to -- 117,710,928M USD -- sure it isn't a billion but it's more than enough to hustle a few hundred k through whenever you want
    - vrotaru 15y ago
      I am wrong, or the dollars should be already laundered before they reach MtGox? You have to transfer them from a bank account, right?
      - weavejester 15y ago
        No, you could buy bitcoins with unlaundered dollars, even with a credit card, and then launder the bitcoins themselves so that when you spend them they can't be traced back to the account you bought them with.
        hnsmurf 15y ago
        You can do that but it would serve no purpose. If you bought $100k bitcoins on a credit card, now the IRS has a paper trail. They'll want to know where that $100k you paid the credit card bill came from. Even if you got the money in without being traced and spent them that's not laundering, it's tax evasion.
        weavejester 15y ago
        Ah, I misunderstood what was being proposed.
alexsherrick 15y ago
On Silk Road there are lots of ways to money launder... one of the main ways is that you give someone bitcoins and they give you a "gift" on paypal so that there are no fees.

Despite the snark in the thread title, Sen. Chuck Schumer draws a reasonable conclusion. Bitcoin, despite its various other uses, theoretically can be used for money laundering.

9ec4c12949a4f3 15y ago

It absolutely is being used for money laundering right now.

sliverstorm 15y ago

I think the odds are if Sen. Chuck Schumer can conceive that Bitcoins can be used for money laundering, other folks have thought of the exact same thing. I.E. it is already being actively used to launder money.

lizzard 15y ago
I would think that online poker players or other gamblers figured this out a while back.
- yangez 15y ago
  Contrary to popular belief and government propaganda, online poker players aren't any more likely to launder money than you are. Back to the article, like another poster said, how is a bitcoin-based drug site any different in terms of anonymity than a cash-based one if you have to give your address out at the end anyway?
  - doyoulikeworms 15y ago
    Mailing cash is scary and risky. Using Bitcoin doesn't remove the risk of fraud, but it removes the risk of your payment being lost/intercepted.
  - hnsmurf 15y ago
    The winners are highly likely to evade taxes but have no need to launder. Money laundering is unnecessary because online gambling proceeds aren't illegal in most states, and even where they are the Silver Platter doctrine and the fact that AGs don't prosecute customers generally makes it not worth while. I played poker for a living in a state where it is illegal to do so and still just claimed taxes legally (which is unusual for a poker player).
  - sliverstorm 15y ago
    any different in terms of anonymity The idea, in theory, is that the use of BitCoins cannot be tracked by a third party. That is to say, Silk Road, you and your dealer are the only ones who know about the purchase. In theory all three of you do not keep records of the sale, unlike credit card companies, which keep records of EVERYTHING.
hnsmurf 15y ago
I get the impression that the supply and utility of Bitcoin are both still far too low to be used for serious money laundering. Laundering isn't particularly difficult anyway. You're probably still just better off buying a bar and pouring vodka down the drain.
- feydr 15y ago
  uhhh... check your math bro -- as of this moment there are 6,453,450 BTC in existence -- and you can buy them for $18.24 a piece leading to -- 117,710,928M USD -- sure it isn't a billion but it's more than enough to hustle a few hundred k through whenever you want
  - vrotaru 15y ago
    I am wrong, or the dollars should be already laundered before they reach MtGox? You have to transfer them from a bank account, right?
    - weavejester 15y ago
      No, you could buy bitcoins with unlaundered dollars, even with a credit card, and then launder the bitcoins themselves so that when you spend them they can't be traced back to the account you bought them with.
      - hnsmurf 15y ago
        You can do that but it would serve no purpose. If you bought $100k bitcoins on a credit card, now the IRS has a paper trail. They'll want to know where that $100k you paid the credit card bill came from. Even if you got the money in without being traced and spent them that's not laundering, it's tax evasion.
        weavejester 15y ago
        Ah, I misunderstood what was being proposed.

alexsherrick 15y ago

On Silk Road there are lots of ways to money launder... one of the main ways is that you give someone bitcoins and they give you a "gift" on paypal so that there are no fees.