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For most financial crimes in the US the federal statute of limitations is 10 years. There’s also a “knowledge” element to the crime of money laundering. So let’

For most financial crimes in the US the federal statute of limitations is 10 years. There’s also a “knowledge” element to the crime of money laundering. So let’s say someone sold a pizza for bitcoin a decade ago and it just so happens that bitcoin was obtained through unlawful conduct. Now the pizza seller might have technically, arguably, “laundered” the funds but as long as the pizza seller didn’t know the bitcoin was from criminal activity the pizza seller didn’t commit the crime of money laundering. They lacked the requisite criminal intent. This knowledge element is why the FBI’s email to Tornado is critical to the case. The agent specifically told Tornado the funds were obtained through illegal means so the DOJ can demonstrate Tornado had actual knowledge of the purpose of the transaction: structuring rather than privacy. (In theory at least. According to the post the email was never acknowledged or responded to.)

jl2718 5y ago
Does Tornado.cash even have the ability to block transactions?
- elliekelly 5y ago
  I have no idea but from a legal perspective I don’t think it’s relevant to the question of whether or not they’ve committed the crime of money laundering. Although I’m not sure anyone has tried the “my algorithm is beyond of my control” defense yet?
  - dannyw 5y ago
    There exists code that functionally cannot be deactivated, disabled, or removed on the blockchain (Uniswap is a good exmaple, no admin keys). Let's say the SEC prosecutes Uniswap Labs for running a securities exchange. What they cannot do, and what no one can do, is shut down the underlying code behind Uniswap.
    - deleted 5y ago
      [deleted]
MagicWishMonkey 5y ago
Yep, the FBI is unlikely to nail you to the wall for doing something inadvertantly (unless it was really really bad). A friend of mine is a field agent who spent years prosecuting financial crimes, and a lot of her time was spent knocking on doors and telling people to stop doing stupid stuff. Like one lady in particular was elderly and kept getting taken advantage of by money launderers (people putting cash in her account and telling her to deposit it somewhere else). My friend had to visit her on multiple occasions to explain that she needed to stop doing that.
- Verdex 5y ago
  "This is really blatant money laundering? How are you planning on beating the FBI?" "Seriously? Oh, I'm old and confused and this nice young gentlemen on the telephone called me and said he accidentally put a bunch of money into my account that was supposed to go to his mother. Such a nice boy. Just keep up your side of the deal. If my cut isn't in the Cayman account within the week, then I can guarantee that you won't be worrying about the FBI." EDIT: Just to be clear. I'm hoping that we don't unknowingly live in a universe where all elderly people are secret underworld mob bosses. However, I'm honestly not sure how you would tell the difference between a sufficiently proficient elderly mob boss and someone who's just old and hasn't kept up with changing trends.
  - MagicWishMonkey 5y ago
    haha, that scenario definitely crossed my mind when I heard about it, but she's not an idiot (my friend) - I assume they had other reasons to think the lady wasn't all there, but I didn't ask. Prior to working in financial crimes she spent a lot of time dealing with catching drug dealers/smugglers/cartels, which I think is where most agents go to cut their teeth, so she's heard pretty much every ridiculous excuse/justification you can imagine.
FDSGSG 5y ago
Are you sure that you aren't confusing Tornado with Bitcoin Fog?
- elliekelly 5y ago
  I’m too late to edit but you are indeed correct, thanks!
nostrademons 5y ago
Bitcoin Fog, not Tornado. To my knowledge there's no case against Tornado. It's doubtful that there'd be any point to one - Tornado is just a smart contract on the Ethereum blockchain, so it will exist as long as the blockchain exists, and putting its developers in jail is not going to change that.

jl2718 5y ago

Does Tornado.cash even have the ability to block transactions?

elliekelly 5y ago
I have no idea but from a legal perspective I don’t think it’s relevant to the question of whether or not they’ve committed the crime of money laundering. Although I’m not sure anyone has tried the “my algorithm is beyond of my control” defense yet?
- dannyw 5y ago
  There exists code that functionally cannot be deactivated, disabled, or removed on the blockchain (Uniswap is a good exmaple, no admin keys). Let's say the SEC prosecutes Uniswap Labs for running a securities exchange. What they cannot do, and what no one can do, is shut down the underlying code behind Uniswap.
  - deleted 5y ago
    [deleted]

MagicWishMonkey 5y ago

Yep, the FBI is unlikely to nail you to the wall for doing something inadvertantly (unless it was really really bad). A friend of mine is a field agent who spent years prosecuting financial crimes, and a lot of her time was spent knocking on doors and telling people to stop doing stupid stuff. Like one lady in particular was elderly and kept getting taken advantage of by money launderers (people putting cash in her account and telling her to deposit it somewhere else). My friend had to visit her on multiple occasions to explain that she needed to stop doing that.

Verdex 5y ago
"This is really blatant money laundering? How are you planning on beating the FBI?" "Seriously? Oh, I'm old and confused and this nice young gentlemen on the telephone called me and said he accidentally put a bunch of money into my account that was supposed to go to his mother. Such a nice boy. Just keep up your side of the deal. If my cut isn't in the Cayman account within the week, then I can guarantee that you won't be worrying about the FBI." EDIT: Just to be clear. I'm hoping that we don't unknowingly live in a universe where all elderly people are secret underworld mob bosses. However, I'm honestly not sure how you would tell the difference between a sufficiently proficient elderly mob boss and someone who's just old and hasn't kept up with changing trends.
- MagicWishMonkey 5y ago
  haha, that scenario definitely crossed my mind when I heard about it, but she's not an idiot (my friend) - I assume they had other reasons to think the lady wasn't all there, but I didn't ask. Prior to working in financial crimes she spent a lot of time dealing with catching drug dealers/smugglers/cartels, which I think is where most agents go to cut their teeth, so she's heard pretty much every ridiculous excuse/justification you can imagine.

FDSGSG 5y ago

Are you sure that you aren't confusing Tornado with Bitcoin Fog?

elliekelly 5y ago
I’m too late to edit but you are indeed correct, thanks!

nostrademons 5y ago

Bitcoin Fog, not Tornado. To my knowledge there's no case against Tornado. It's doubtful that there'd be any point to one - Tornado is just a smart contract on the Ethereum blockchain, so it will exist as long as the blockchain exists, and putting its developers in jail is not going to change that.