5 ms·

They can't be easily traced to a particular person is what they mean. Detached from names it's largely meaningless like an encrypted chat, technically the data'

by rtkwe 5y ago

They can't be easily traced to a particular person is what they mean. Detached from names it's largely meaningless like an encrypted chat, technically the data's all there but it needs other data to be usefully tracked.

ekianjo 5y ago
> They can't be easily traced to a particular person is what they mean Exchanges typically ask for an ID in most countries these day before you can purchase any crypto. I'd be curious how you avoid detection unless you started very early in crypto by mining on your own. You'd still need an ID to exchange back to fiat anyway.
omginternets 5y ago
It's way easier to correlate activity to a particular person with a blockchain than with traditional banking. There are no administrative hoops to getting access to transaction data.
- rtkwe 5y ago
  That assumes it's gone through some deanonymizing transaction like with someone who does know your customer compliance. Tumblers still work right?
  - acdha 5y ago
    Maybe: even assuming that the one you use isn’t run by the FBI, compromised, or sloppy with their security, it’s still easy to block transactions which trace back to one and that both lowers the value of those coins and increases the risk of using them. Some people will say they aren’t doing anything big enough to warrant attention but that’s forgetting that everyone using a tumbler is paying extra to help anonymous strangers launder money. If anyone involved attracts attention it’ll bring scrutiny to everyone else, and potentially the need to prove that you were “just” committing a small-scale crime and didn’t know that most of the other coins being tumbled belonged to a cartel.
  - dvt 5y ago
    > Tumblers still work right? Anything you tumble, you can (provably) de-tumble. It's just expensive and time-consuming (re-building the blockchain state, yadda yadda). Crypto banking is less anonymous than actual banking, especially if you actually want to pull your money into fiat and need to go through an exchange.
    - teh_infallible 5y ago
      Bitcoin Cash has CashFusion, which does not rely on a central server, and since transactions are less than a cent, you can shuffle your coins as much as you want. https://cashfusion.org/ https://cashfusion.org/
      - 3np 5y ago
        Do you know how/if CF differs from JoinMarket (both are two-sided CoinJoin implementations, on two different chains) One-sided JM for BTC include Wasabi and Samourai Whirlpool. Though Samourai are a bit sketch IMO.
      - tylersmith 5y ago
        Its anonymity set is basically non-existant, so no real amount of funds can be obfuscated with CashFusion.
        3np 5y ago
        I'd love to see an analysis of the real-world numbers, though I suspect you may be right. Note also it's a function of time (ie if you run the maker side yourself you will participate in others' joins and slowly work up your anonymity set). Over several weeks/months it may be viable to obfuscate even significant amounts.
    - gruez 5y ago
      >you can (provably) de-tumble not really? If you have a transaction that has five equally sized inputs A_{1...5} and five equally sized outputs B_{1...5}, then the max extent you can "provably" de-tumble B_1 is saying "there's a 20% chance that it came from A_1, 20% chance it came from A_2, ..."
  - omginternets 5y ago
    >Tumblers still work right? I don't really know, but putting myself in a criminal's shoes, I don't like the idea that my transactions stay in plain view forever. It makes statistical attacks very, very easy. It also makes me vulnerable as-of-yet-undiscovered statistical attacks. BitCoin is arguably the worst thing for organized crime.
    - eurasiantiger 5y ago
      Tell that to the guys that have been launching coin/token scams to the tune of hundreds of millions of dollars and are now buying out traditional companies with their flash cash. We will soon be living in a world where crime is the norm.
      - omginternets 5y ago
        Most of those criminals live in jurisdictions that are either unwilling or unable to prosecute them.
  - anonymoushn 5y ago
    In current_year people use cryptographically secure tumbler-like services like Tornado Cash. Everyone will just assume you're a criminal if your funds come from Tornado Cash and you don't prove the origin before then though.
    - rank0 5y ago
      Serious question: Why do you believe tornado to be secure? The project is self described as experimental software.
      - anonymoushn 5y ago
        this is afaik no longer true as of over a year ago
        rank0 5y ago
        From the main page of the app: “ Tornado.cash was audited. However, it is still an experimental software. Please use at your own risk.”
- godelski 5y ago
  This is exactly the potential danger of countries creating their own digital currency. If they aren't privacy coins then said government has a ledger of every single transaction that its citizens have made. And in that case the gov will know what IDs correspond to which names. Of course if the country adopts a privacy coin this would in turn be a great win for privacy. Of course there's still the danger of if we can ensure that privacy and ensure that it stays that way. So this is something many need to consider during discussions about the FedCoin and Digital Yuan. The "crypto" in "cryptocurrency" isn't necessarily the same "crypto" as we understand in privacy. E.g. Bank transactions are cryptographically secure, but not private.
ajkdhcb2 5y ago
It can almost always be easily traced to a particular person. if you're using it, you probably bought it from somewhere and spent it somewhere. Mixers/coinjoins can launder it but it is risk-prone and time-consuming, and a redflag.
- stef25 5y ago
  > It can almost always be easily traced to a particular person Once KYC gets involved. If I receive coins in my desktop wallet for the cookies I'm selling, how will anyone know who I am? Of course they're not much use until I cash out and then it's a different story.
  - sennight 5y ago
    > Of course they're not much use until I cash out... Or you could use the currency as a currency. Sure, there are a lot more flour suppliers who exclusively accept USD vs ones that take BTC - but compared to the way things were 10 years ago...
    - xorcist 5y ago
      "Cashing out" doesn't necessarily mean dollars. Try to buy a Tesla or a house anonymously. All large transactions are subject to KYC.
      - sennight 5y ago
        It sounds like your definition of "cashing out" means "do anything that has historically involved counterparty risk". Unless you really think a warehouse manager would insist on carding you for several pallets of dishwashing detergent...
        ajkdhcb2 5y ago
        I tried to pay BTC for a very small electronics purchase recently and the payment processor BitPay literally demanded passport information

by rtkwe 5y ago

ekianjo 5y ago

> They can't be easily traced to a particular person is what they mean Exchanges typically ask for an ID in most countries these day before you can purchase any crypto. I'd be curious how you avoid detection unless you started very early in crypto by mining on your own. You'd still need an ID to exchange back to fiat anyway.

omginternets 5y ago

It's way easier to correlate activity to a particular person with a blockchain than with traditional banking. There are no administrative hoops to getting access to transaction data.

rtkwe 5y ago
That assumes it's gone through some deanonymizing transaction like with someone who does know your customer compliance. Tumblers still work right?
- acdha 5y ago
  Maybe: even assuming that the one you use isn’t run by the FBI, compromised, or sloppy with their security, it’s still easy to block transactions which trace back to one and that both lowers the value of those coins and increases the risk of using them. Some people will say they aren’t doing anything big enough to warrant attention but that’s forgetting that everyone using a tumbler is paying extra to help anonymous strangers launder money. If anyone involved attracts attention it’ll bring scrutiny to everyone else, and potentially the need to prove that you were “just” committing a small-scale crime and didn’t know that most of the other coins being tumbled belonged to a cartel.
- dvt 5y ago
  > Tumblers still work right? Anything you tumble, you can (provably) de-tumble. It's just expensive and time-consuming (re-building the blockchain state, yadda yadda). Crypto banking is less anonymous than actual banking, especially if you actually want to pull your money into fiat and need to go through an exchange.
  - teh_infallible 5y ago
    Bitcoin Cash has CashFusion, which does not rely on a central server, and since transactions are less than a cent, you can shuffle your coins as much as you want. https://cashfusion.org/ https://cashfusion.org/
    - 3np 5y ago
      Do you know how/if CF differs from JoinMarket (both are two-sided CoinJoin implementations, on two different chains) One-sided JM for BTC include Wasabi and Samourai Whirlpool. Though Samourai are a bit sketch IMO.
    - tylersmith 5y ago
      Its anonymity set is basically non-existant, so no real amount of funds can be obfuscated with CashFusion.
      - 3np 5y ago
        I'd love to see an analysis of the real-world numbers, though I suspect you may be right. Note also it's a function of time (ie if you run the maker side yourself you will participate in others' joins and slowly work up your anonymity set). Over several weeks/months it may be viable to obfuscate even significant amounts.
  - gruez 5y ago
    >you can (provably) de-tumble not really? If you have a transaction that has five equally sized inputs A_{1...5} and five equally sized outputs B_{1...5}, then the max extent you can "provably" de-tumble B_1 is saying "there's a 20% chance that it came from A_1, 20% chance it came from A_2, ..."
- omginternets 5y ago
  >Tumblers still work right? I don't really know, but putting myself in a criminal's shoes, I don't like the idea that my transactions stay in plain view forever. It makes statistical attacks very, very easy. It also makes me vulnerable as-of-yet-undiscovered statistical attacks. BitCoin is arguably the worst thing for organized crime.
  - eurasiantiger 5y ago
    Tell that to the guys that have been launching coin/token scams to the tune of hundreds of millions of dollars and are now buying out traditional companies with their flash cash. We will soon be living in a world where crime is the norm.
    - omginternets 5y ago
      Most of those criminals live in jurisdictions that are either unwilling or unable to prosecute them.
- anonymoushn 5y ago
  In current_year people use cryptographically secure tumbler-like services like Tornado Cash. Everyone will just assume you're a criminal if your funds come from Tornado Cash and you don't prove the origin before then though.
  - rank0 5y ago
    Serious question: Why do you believe tornado to be secure? The project is self described as experimental software.
    - anonymoushn 5y ago
      this is afaik no longer true as of over a year ago
      - rank0 5y ago
        From the main page of the app: “ Tornado.cash was audited. However, it is still an experimental software. Please use at your own risk.”
godelski 5y ago
This is exactly the potential danger of countries creating their own digital currency. If they aren't privacy coins then said government has a ledger of every single transaction that its citizens have made. And in that case the gov will know what IDs correspond to which names. Of course if the country adopts a privacy coin this would in turn be a great win for privacy. Of course there's still the danger of if we can ensure that privacy and ensure that it stays that way. So this is something many need to consider during discussions about the FedCoin and Digital Yuan. The "crypto" in "cryptocurrency" isn't necessarily the same "crypto" as we understand in privacy. E.g. Bank transactions are cryptographically secure, but not private.

ajkdhcb2 5y ago

It can almost always be easily traced to a particular person. if you're using it, you probably bought it from somewhere and spent it somewhere. Mixers/coinjoins can launder it but it is risk-prone and time-consuming, and a redflag.

stef25 5y ago
> It can almost always be easily traced to a particular person Once KYC gets involved. If I receive coins in my desktop wallet for the cookies I'm selling, how will anyone know who I am? Of course they're not much use until I cash out and then it's a different story.
- sennight 5y ago
  > Of course they're not much use until I cash out... Or you could use the currency as a currency. Sure, there are a lot more flour suppliers who exclusively accept USD vs ones that take BTC - but compared to the way things were 10 years ago...
  - xorcist 5y ago
    "Cashing out" doesn't necessarily mean dollars. Try to buy a Tesla or a house anonymously. All large transactions are subject to KYC.
    - sennight 5y ago
      It sounds like your definition of "cashing out" means "do anything that has historically involved counterparty risk". Unless you really think a warehouse manager would insist on carding you for several pallets of dishwashing detergent...
      - ajkdhcb2 5y ago
        I tried to pay BTC for a very small electronics purchase recently and the payment processor BitPay literally demanded passport information