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Misleading headline. Very misleading. They took a list of addresses that were known to be associated with illicit activity and calculated what percent of trans

Misleading headline. Very misleading. They took a list of addresses that were known to be associated with illicit activity and calculated what percent of transactions went to those specific addresses: > Transactions involving illicit addresses represented just 0.15% of cryptocurrency transaction... Unless you believe they've identified all of the illicit addresses (they haven't) then this report is worthless for anything other than those specific addresses.

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amluto 5y ago
The calculation of licit activity is a bit dubious, too. For example, the foreign exchange market has an overall volume of $6 trillion or so. It does not follow that the US GDP is only about 1% of total currency transactions and is therefore immaterial (or alternatively that currency in general is useless because 99% of global transactions are unproductive). I’m also suspicious that Chainalysis doesn’t understand the UTXO model. If you have $1bn of Bitcoin in a single “account” (UTXO) and you spend $1, you just “transacted $1bn”. I don’t know if there are good stats on what fraction of “total volume” consists of cryptocurrency holders simply making change for themselves. It’s not immediately obvious from the blockchain which transactions outputs are actually intended for parties other than the originator of the transaction.
- cwkoss 5y ago
  Chainalysis is very misleading, and a lot of naive people are taking their claims at face value. Any chain analysis software either: - Has insider information from all of the major exchanges, or - Is just guessing about almost everything, so their analysis is based on many layers of questionable assumptions.
steelstraw 5y ago
What's the alternative? This shows what % is known to be illicit. No crime stats about anything capture 100% of illicit activity, yet it's still useful information. Anything else is just guesswork.
invalidname 5y ago
Yep. That's also just one way to do elicit activity in bitcoin. A person can literally send his wallet to someone else as payment for a crime. The ways to use crypto for crime are endless.

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amluto 5y ago

The calculation of licit activity is a bit dubious, too. For example, the foreign exchange market has an overall volume of $6 trillion or so. It does not follow that the US GDP is only about 1% of total currency transactions and is therefore immaterial (or alternatively that currency in general is useless because 99% of global transactions are unproductive). I’m also suspicious that Chainalysis doesn’t understand the UTXO model. If you have $1bn of Bitcoin in a single “account” (UTXO) and you spend $1, you just “transacted $1bn”. I don’t know if there are good stats on what fraction of “total volume” consists of cryptocurrency holders simply making change for themselves. It’s not immediately obvious from the blockchain which transactions outputs are actually intended for parties other than the originator of the transaction.

cwkoss 5y ago
Chainalysis is very misleading, and a lot of naive people are taking their claims at face value. Any chain analysis software either: - Has insider information from all of the major exchanges, or - Is just guessing about almost everything, so their analysis is based on many layers of questionable assumptions.

steelstraw 5y ago

What's the alternative? This shows what % is known to be illicit. No crime stats about anything capture 100% of illicit activity, yet it's still useful information. Anything else is just guesswork.

invalidname 5y ago

Yep. That's also just one way to do elicit activity in bitcoin. A person can literally send his wallet to someone else as payment for a crime. The ways to use crypto for crime are endless.