5 ms·

Bitcoin is a dream come true for the FBI/CIA. There are companies building sophisticated software to track the routing of shady payments through the blockchain

Bitcoin is a dream come true for the FBI/CIA. There are companies building sophisticated software to track the routing of shady payments through the blockchain (wouldn't be surprised if Palantir does this). Eventually, crypto finds it way towards a tangible asset that can be tied to somebody and it's just a matter of a paper trail.

toomuchtodo 5y ago
> There are companies building sophisticated software to track the routing of shady payments through the blockchain https://www.chainalysis.com/ https://www.chainalysis.com/ (no affiliation)
xgulfie 5y ago
Serious question, I thought BTC's only usefulness came from its usefulness in laundering money. Is this not true?
- strombofulous 5y ago
  bitcoin works by distributing the entire history of all bitcoin transactions among a distributed pool of nodes. Anyone can look at any transaction at any time with only a small amount of effort. there are services that will "mix" your coins with a bunch of other people's, but you can see all the coins that went into the service and the addresses they were all sent to so it's not foolproof. I've heard that monero is a coin that can be used for laundering, but I've never looked into it so I can't say for sure
- hackinthebochs 5y ago
  Bitcoin's usefulness comes from being able to transact value without a centralized authority. There are no gatekeepers to determine who can transact with whom, to assign value to a medium, or to take that value away. It is democratization of financial power.
  - xgulfie 5y ago
    I mean pragmatically not abstractly. Bitcoin transaction fees were >$50 recently, so it's useless as a form of payment, and nothing is keeping it from being worthless tomorrow so it's a poor parking spot for money.
    - deleted 5y ago
      [deleted]
    - hackinthebochs 5y ago
      Pragmatically, I can buy things online without having to give up my name and address. That's a win for me.
      - Craighead 5y ago
        ... if they are physical items how do you get them?
    - curryst 5y ago
      The main advantage is avoiding the traditional financial systems, as you note. One use of that is to launder money, as you note. Other uses include paying for illegal things (drugs, child pornography, or in some countries run of the mill goods that are banned), or as a parking spot for money when your other options are even worse. I.e. there probably isn't a worse spot to put your money than in Venezuela's currency; despite Bitcoin's instability, it's unlikely to deflate faster than Venezuelan currency. You can also use it to move currency around. I've heard that wealthy Chinese people use it as a vehicle to get money out of China, but I'm not terribly well-versed in that.
- otterley 5y ago
  I wouldn't say laundering money is its only utility, but the value of BTC is quite likely a reflection of the economic value of illicit activity (or black-market savings, if you prefer). Given how relatively difficult BTC is to use for the average person, it's the simplest explanation (per Occam's razor) for why it's worth so much in aggregate. Think about it: If you were a criminal, would you rather keep your cash under a proverbial mattress like in the old days, or in properties that could be seized by the local government? Or in BTC, where it can't really be seized, is semi-anonymous, and where there is a (imperfect but decent) exchange market for fiat currency (and, rarely, goods and services) when you need it? I know what I would choose.
  - jokethrowaway 5y ago
    I disagree: criminals mostly use it as a mean to transfer money. The main reason behind the rise in price is purely speculation and fomo.
varispeed 5y ago
That is the ultimate problem of Bitcoin that it is non-fungible, which means it's not a real currency if 1 BTC != another 1 BTC. If you get paid in BTC you never know if you receive tainted coins and have them confiscated by exchange at the withdrawal attempt.

toomuchtodo 5y ago

> There are companies building sophisticated software to track the routing of shady payments through the blockchain https://www.chainalysis.com/ https://www.chainalysis.com/ (no affiliation)

xgulfie 5y ago

Serious question, I thought BTC's only usefulness came from its usefulness in laundering money. Is this not true?

strombofulous 5y ago
bitcoin works by distributing the entire history of all bitcoin transactions among a distributed pool of nodes. Anyone can look at any transaction at any time with only a small amount of effort. there are services that will "mix" your coins with a bunch of other people's, but you can see all the coins that went into the service and the addresses they were all sent to so it's not foolproof. I've heard that monero is a coin that can be used for laundering, but I've never looked into it so I can't say for sure
hackinthebochs 5y ago
Bitcoin's usefulness comes from being able to transact value without a centralized authority. There are no gatekeepers to determine who can transact with whom, to assign value to a medium, or to take that value away. It is democratization of financial power.
- xgulfie 5y ago
  I mean pragmatically not abstractly. Bitcoin transaction fees were >$50 recently, so it's useless as a form of payment, and nothing is keeping it from being worthless tomorrow so it's a poor parking spot for money.
  - deleted 5y ago
    [deleted]
  - hackinthebochs 5y ago
    Pragmatically, I can buy things online without having to give up my name and address. That's a win for me.
    - Craighead 5y ago
      ... if they are physical items how do you get them?
  - curryst 5y ago
    The main advantage is avoiding the traditional financial systems, as you note. One use of that is to launder money, as you note. Other uses include paying for illegal things (drugs, child pornography, or in some countries run of the mill goods that are banned), or as a parking spot for money when your other options are even worse. I.e. there probably isn't a worse spot to put your money than in Venezuela's currency; despite Bitcoin's instability, it's unlikely to deflate faster than Venezuelan currency. You can also use it to move currency around. I've heard that wealthy Chinese people use it as a vehicle to get money out of China, but I'm not terribly well-versed in that.
otterley 5y ago
I wouldn't say laundering money is its only utility, but the value of BTC is quite likely a reflection of the economic value of illicit activity (or black-market savings, if you prefer). Given how relatively difficult BTC is to use for the average person, it's the simplest explanation (per Occam's razor) for why it's worth so much in aggregate. Think about it: If you were a criminal, would you rather keep your cash under a proverbial mattress like in the old days, or in properties that could be seized by the local government? Or in BTC, where it can't really be seized, is semi-anonymous, and where there is a (imperfect but decent) exchange market for fiat currency (and, rarely, goods and services) when you need it? I know what I would choose.
- jokethrowaway 5y ago
  I disagree: criminals mostly use it as a mean to transfer money. The main reason behind the rise in price is purely speculation and fomo.

varispeed 5y ago

That is the ultimate problem of Bitcoin that it is non-fungible, which means it's not a real currency if 1 BTC != another 1 BTC. If you get paid in BTC you never know if you receive tainted coins and have them confiscated by exchange at the withdrawal attempt.