5 ms·

Sure, if you don't use mixers

by drcode 5y ago

ghostbrainalpha 5y ago
Side question: How difficult is it to use a mixer? If you have the tech skills to mine bitcoin is it trivial to find and use a mixer, or is it something requiring more specific expertise?
- drcode 5y ago
  Not too difficult, though I've never done it so can't say for sure.
- tracedddd 5y ago
  It’s relatively trivial to use a mixer, just like sending any other transaction. The mixer deals with all the complexity. However almost all mixers have been eventually compromised. It’s likely chainalysis and others can easily demix the transactions, so they really shouldn’t be entirely trusted.
rblatz 5y ago
Yes, laundering money does tend to obscure the source of money.
- drcode 5y ago
  Money laundering is when you make it look like illicit money derived from a legitimate income stream, paying the taxes that result from such income.
dragontamer 5y ago
I'm pretty sure mixers are currently illegal and will be treated as such once the debate starts. Money laundering (aka, pooling cash together to make it harder to track) is defacto illegal by itself, even if you use the money for legitimate purposes.
- vmception 5y ago
  What you described is not illegal by itself. Obfuscating the origin of earnings is not illegal. Although "pooling" may be regulated in other ways. A federal "money laundering" charge requires an illicit origin, and so since successful money laundering will never have an illicit origin, the charge can only be tacked on to another indictment. After centuries of not having much surveillance tools of the money supply, the state has had a 50 year run of the privilege of deputizing financial intermediaries to surveil the electronic payment system. Now the electronic payment system will begin to inherit the same tenets of cash. This is just a reversion to the mean.
  - sleepybrett 5y ago
    I'm not sure how to phrase this. But I'm reminded of the dark knight returns where because all the mobs pooled their money together with their launderer (their mixer) they could all be prosecuted together in a RICO case. Is use of a mixer de facto evidence of laundering...
  - dragontamer 5y ago
    > A federal "money laundering" charge requires an illicit origin, and so since successful money laundering will never have an illicit origin, the charge can only be tacked on to another indictment. Fair. But think about it: a _singular_ person in your mixing pool can make the entire pool illegal. One, singular, person using that money for contraband (illegal porn, illegal drugs, illegal tax evasion) will turn the entire pool illegal. Do you trust everyone else in the pool to be using it for legitimate gains? If you went into court, would you be able to say with a straight face that "Everyone in my mixing pool was in fact, doing legal activities?" So in practice, I'd argue that most mixers are illegal (because surely, there's at least one person using the mixer for illegitimate purposes). Furthermore: the BTC transaction into the pool (and out of the pool) will forever be written into the blockchain. If you use your same wallet for both sides (or if the prosecutors can prove that one of your wallets was on the input-side, and another one of your wallets was on the output-side of the mixing process), you're now tied to all of the illegal activities that mixing pool is associated with. ---------- That's the thing. Mixing pools have never been tested in court. But imagine what a prosecutor would say to a jury, and imagine what the jury would rule.
jondwillis 5y ago
Or, swap to a privacy token and back.
- drcode 5y ago
  Just want to point out it's not quite that easy: If you convert 1.24 (or whatever) bitcoins into zcash/monero/etc and then 1.24 right back into bitcoins, everyone will know those transactions were likely connected.
  - nybble41 5y ago
    I should think that it would be obvious that you don't put in 1.24 BTC and then take out 1.24 BTC later. Someone trying to hide the source of their funds via a mixer or Monero or whatever would put in 1.24 BTC and take out 1 BTC + 0.2 BTC + 2*(0.02 BTC) (or some other set of common denominations) in separate transactions to distinct BTC wallets, taking steps to ensure that these transactions can't be correlated with each other by IP address, time, etc. They want to hide the withdrawals in a sea of indistinguishable, uniform transactions; moving a unique, traceable quantity all at once would be a clear red flag. The principle is hardly obscure; it's exactly the same as the popular image of criminals conducting business with suitcases full of unmarked $20 bills. They use $20 bills because they're commonplace, not because they're more convenient than $50 or $100 bills.

Sure, if you don't use mixers

by drcode 5y ago

Sure, if you don't use mixers

Side question: How difficult is it to use a mixer? If you have the tech skills to mine bitcoin is it trivial to find and use a mixer, or is it something requiring more specific expertise?

drcode 5y ago
Not too difficult, though I've never done it so can't say for sure.
tracedddd 5y ago
It’s relatively trivial to use a mixer, just like sending any other transaction. The mixer deals with all the complexity. However almost all mixers have been eventually compromised. It’s likely chainalysis and others can easily demix the transactions, so they really shouldn’t be entirely trusted.

rblatz 5y ago

Yes, laundering money does tend to obscure the source of money.

drcode 5y ago
Money laundering is when you make it look like illicit money derived from a legitimate income stream, paying the taxes that result from such income.

dragontamer 5y ago

I'm pretty sure mixers are currently illegal and will be treated as such once the debate starts. Money laundering (aka, pooling cash together to make it harder to track) is defacto illegal by itself, even if you use the money for legitimate purposes.

vmception 5y ago
What you described is not illegal by itself. Obfuscating the origin of earnings is not illegal. Although "pooling" may be regulated in other ways. A federal "money laundering" charge requires an illicit origin, and so since successful money laundering will never have an illicit origin, the charge can only be tacked on to another indictment. After centuries of not having much surveillance tools of the money supply, the state has had a 50 year run of the privilege of deputizing financial intermediaries to surveil the electronic payment system. Now the electronic payment system will begin to inherit the same tenets of cash. This is just a reversion to the mean.
- sleepybrett 5y ago
  I'm not sure how to phrase this. But I'm reminded of the dark knight returns where because all the mobs pooled their money together with their launderer (their mixer) they could all be prosecuted together in a RICO case. Is use of a mixer de facto evidence of laundering...
- dragontamer 5y ago
  > A federal "money laundering" charge requires an illicit origin, and so since successful money laundering will never have an illicit origin, the charge can only be tacked on to another indictment. Fair. But think about it: a _singular_ person in your mixing pool can make the entire pool illegal. One, singular, person using that money for contraband (illegal porn, illegal drugs, illegal tax evasion) will turn the entire pool illegal. Do you trust everyone else in the pool to be using it for legitimate gains? If you went into court, would you be able to say with a straight face that "Everyone in my mixing pool was in fact, doing legal activities?" So in practice, I'd argue that most mixers are illegal (because surely, there's at least one person using the mixer for illegitimate purposes). Furthermore: the BTC transaction into the pool (and out of the pool) will forever be written into the blockchain. If you use your same wallet for both sides (or if the prosecutors can prove that one of your wallets was on the input-side, and another one of your wallets was on the output-side of the mixing process), you're now tied to all of the illegal activities that mixing pool is associated with. ---------- That's the thing. Mixing pools have never been tested in court. But imagine what a prosecutor would say to a jury, and imagine what the jury would rule.

jondwillis 5y ago

Or, swap to a privacy token and back.

drcode 5y ago
Just want to point out it's not quite that easy: If you convert 1.24 (or whatever) bitcoins into zcash/monero/etc and then 1.24 right back into bitcoins, everyone will know those transactions were likely connected.
- nybble41 5y ago
  I should think that it would be obvious that you don't put in 1.24 BTC and then take out 1.24 BTC later. Someone trying to hide the source of their funds via a mixer or Monero or whatever would put in 1.24 BTC and take out 1 BTC + 0.2 BTC + 2*(0.02 BTC) (or some other set of common denominations) in separate transactions to distinct BTC wallets, taking steps to ensure that these transactions can't be correlated with each other by IP address, time, etc. They want to hide the withdrawals in a sea of indistinguishable, uniform transactions; moving a unique, traceable quantity all at once would be a clear red flag. The principle is hardly obscure; it's exactly the same as the popular image of criminals conducting business with suitcases full of unmarked $20 bills. They use $20 bills because they're commonplace, not because they're more convenient than $50 or $100 bills.