4 ms·

This is flat wrong, Crypto is one of the hardest places to launder money. This comment betrays a lack of understanding of how it works at even the most basic le

This is flat wrong, Crypto is one of the hardest places to launder money. This comment betrays a lack of understanding of how it works at even the most basic level..

raesene9 5y ago
So in this weeks crypto.com hack the attackers appear to have moved $30m through tumblers to launder the money (https://cointelegraph.com/news/crypto-com-breach-may-be-worth-up-to-33m-suggests-onchain-analyst https://cointelegraph.com/news/crypto-com-breach-may-be-wort...), doesn't feel like they found it that hard to do. To put that in context laundering $30m in a country with even semi-decent Financial regs, like the (mainland) UK would take some doing. It's possible but it'd require more work than that.
- thr0waw4yz 5y ago
  Sending crypto through a mixer isn't money laundering. You still need to effectively launder it afterwards to say - buy a house from it. Mixing is just the first step to cover the tracks after committing a financial crime.
  - raesene9 5y ago
    Why do you need to move it out of crypto to launder it? Laundering is concealing the source of funds to avoid it being associated with a criminal activity. You can run it through a tumbler then use the proceeds to buy an NFT, the coins used will appear to be clean. If you're feeling fancy you could then re-sell the NFT, no need to touch fiat.
    - thr0waw4yz 5y ago
      You need to provide origin of funds for purchases exceeding a few thousand bucks (depending on jurisdiction). At some point you would wanna sell the NFT to buy something from it. I mean sure, there is the dark web, or face to face trading... If you're into that.
      - raesene9 5y ago
        I'm guessing that very much depends on the jurisdiction. Those people that took $30m this week and all the previous thefts this year alone, they all had a plan for how to move that money and I've not seen many of them get caught... According to https://blog.chainalysis.com/reports/2021-crypto-scam-revenues/ https://blog.chainalysis.com/reports/2021-crypto-scam-revenu... - scammers took in $7.7b in 2021 alone, if they couldn't do anything with those funds, doubtful they'd go the effort of stealing them :)
  - cobookman 5y ago
    Say you have controll of wallet A that's clean and never used, and wallet B that has 30M of dirty crypto. You 1. mint a NFT with wallet A. Then 2. Sell the NFT to wallet B. You then deposit the proceeds into coinbase as its legitimate earnings on your NFT artwork. If you want to get creative you can do multiple buy and sells between a collection of wallets to reduce suspicions.
  - 8note 5y ago
    Laundering is * Placement * Layering * Integration A mixer is layering and integration as a service
dogman144 5y ago
This isn't particularly true, there are a lot of details to how KYC/AML for crypt works under the hood for that escape the discussion usually and leave gaping laundering holes. Crypto has its own equivalent of trad-fi shell companies to enable laundering, and it's a bit of a miracle for the space that these details haven't surfaced yet. I'm hoping they don't until the space is much more meshed into regulated finance, such that not much can be done about it.

This is flat wrong, Crypto is one of the hardest places to launder money. This comment betrays a lack of understanding of how it works at even the most basic level..

raesene9 5y ago

So in this weeks crypto.com hack the attackers appear to have moved $30m through tumblers to launder the money (https://cointelegraph.com/news/crypto-com-breach-may-be-worth-up-to-33m-suggests-onchain-analyst https://cointelegraph.com/news/crypto-com-breach-may-be-wort...), doesn't feel like they found it that hard to do. To put that in context laundering $30m in a country with even semi-decent Financial regs, like the (mainland) UK would take some doing. It's possible but it'd require more work than that.

thr0waw4yz 5y ago
Sending crypto through a mixer isn't money laundering. You still need to effectively launder it afterwards to say - buy a house from it. Mixing is just the first step to cover the tracks after committing a financial crime.
- raesene9 5y ago
  Why do you need to move it out of crypto to launder it? Laundering is concealing the source of funds to avoid it being associated with a criminal activity. You can run it through a tumbler then use the proceeds to buy an NFT, the coins used will appear to be clean. If you're feeling fancy you could then re-sell the NFT, no need to touch fiat.
  - thr0waw4yz 5y ago
    You need to provide origin of funds for purchases exceeding a few thousand bucks (depending on jurisdiction). At some point you would wanna sell the NFT to buy something from it. I mean sure, there is the dark web, or face to face trading... If you're into that.
    - raesene9 5y ago
      I'm guessing that very much depends on the jurisdiction. Those people that took $30m this week and all the previous thefts this year alone, they all had a plan for how to move that money and I've not seen many of them get caught... According to https://blog.chainalysis.com/reports/2021-crypto-scam-revenues/ https://blog.chainalysis.com/reports/2021-crypto-scam-revenu... - scammers took in $7.7b in 2021 alone, if they couldn't do anything with those funds, doubtful they'd go the effort of stealing them :)
- cobookman 5y ago
  Say you have controll of wallet A that's clean and never used, and wallet B that has 30M of dirty crypto. You 1. mint a NFT with wallet A. Then 2. Sell the NFT to wallet B. You then deposit the proceeds into coinbase as its legitimate earnings on your NFT artwork. If you want to get creative you can do multiple buy and sells between a collection of wallets to reduce suspicions.
- 8note 5y ago
  Laundering is * Placement * Layering * Integration A mixer is layering and integration as a service

dogman144 5y ago

This isn't particularly true, there are a lot of details to how KYC/AML for crypt works under the hood for that escape the discussion usually and leave gaping laundering holes. Crypto has its own equivalent of trad-fi shell companies to enable laundering, and it's a bit of a miracle for the space that these details haven't surfaced yet. I'm hoping they don't until the space is much more meshed into regulated finance, such that not much can be done about it.