4 ms·

It absolutely does have to do with USD. Other than actual physical dollar bills, which do not scale and are not practical to use for long-distance international

by makomk 4y ago

It absolutely does have to do with USD. Other than actual physical dollar bills, which do not scale and are not practical to use for long-distance international transactions, the only form that real redeemable USD can exist in is deposits with the Fed which can be seized by the US. This is a fundamental property of using the US dollar as your country's currency.

JumpCrisscross 4y ago
> absolutely does have to do with USD Comment you're responding to is saying this is not unique to U.S. dollars. All currencies are controlled by their issuing sovereigns. Separately, the idea that Bitcoin is unsanctionable is laughable. It may require enabling legislation. But marking wallets as sanctioned, and threatening any wallets that transact with it to be either similarly sanctioned or subject to heightened scrutiny, would diminish the value of those coins relative to coins which can be freely traded with anyone. Given the public nature of the blockchain, enforcement would likely be easier than e.g. enforcing an Iranian oil embargo.
- giaour 4y ago
  > But marking wallets as sanctioned, and threatening any wallets that transact with it to be either similarly sanctioned or subject to heightened scrutiny, would diminish the value of those coins relative to coins which can be freely traded with anyone Doesn't this already happen? Basically any bitcoin that comes out of a tumbler or any wallet address that has transacted with tumbled coins is banned on KYC exchanges: https://sethforprivacy.com/posts/fungibility-graveyard/ https://sethforprivacy.com/posts/fungibility-graveyard/
  - randomhodler84 4y ago
    It’s why it’s so important to taint and mix the history of all coins. Given enough time, eventually all UTXOs are tainted, thus nothing is tainted. Most of the supply of BTC can be linked to SR taint from early 2010s. Doesn’t matter now. Litecoin just introduced a sidechain called (mimblewimble extension blocks) MWEB, it permits “cut-through” transactions where UTXOs can mix. It looks like a single UTXO on the main chain. Very Fungible!
    - giaour 4y ago
      What if instead of normalizing money laundering you just didn't launder money?
      - randomhodler84 4y ago
        “What it instead of normalizing privacy, you just don’t have privacy.” The problem is one of pragmatism. All money is dirty. All great fortunes are founded on exploitation. Every dollar in your pocket has been used for crime many times. The system works because we choose to ignore this. If we could programmatically enforce rules, the system would be fail in a day. So it’s not about money laundering, it’s about achieving some kind of pragmatic equivalence, while permitting the system to continue to function.
        giaour 4y ago
        I guess the problem for me is that the immediate action being normalized is just too ethically suspect. The closest analog outside of the cryptocurrency space is a crime that is generally only committed to get away with another crime. That feels categorically different from, say, normalizing using HTTPS or encrypted messenger apps.
        randomhodler84 4y ago
        It’s the dilemma of cryptography, in that you cannot have a secure system that doesn’t also allow bad guys to use it too. The only victim of weakening a system to fight bad guys are the good guys, as the bad guys will just use the original secure version of the protocol, etc. My point is that eventually the major cryptocurrencies will have some fungibility enhancement mechanisms to deal with the practical limitations of taint and chain analysis. Tornado cash, Coinjoin, MW, etc. Its not about normalization of crime. It’s the default ignorant status quo.
        giaour 4y ago
        > It’s the dilemma of cryptography, in that you cannot have a secure system that doesn’t also allow bad guys to use it too. I hear similar things from the NRA about how we'd all be safer if everyone carried a concealed firearm. I just don't want the world to be a place where we all have to be armed and launder our money after every transaction. There is always a balance that needs to be struck between privacy and accountability. Bob Woodward violated the privacy of the Nixon white house, but we generally believe the public interest there outweighs the privacy concerns at stake. I am always particularly skeptical of financial privacy maneuvers, since they are of considerably greater interest to the already rich and powerful.

by makomk 4y ago

JumpCrisscross 4y ago

> absolutely does have to do with USD Comment you're responding to is saying this is not unique to U.S. dollars. All currencies are controlled by their issuing sovereigns. Separately, the idea that Bitcoin is unsanctionable is laughable. It may require enabling legislation. But marking wallets as sanctioned, and threatening any wallets that transact with it to be either similarly sanctioned or subject to heightened scrutiny, would diminish the value of those coins relative to coins which can be freely traded with anyone. Given the public nature of the blockchain, enforcement would likely be easier than e.g. enforcing an Iranian oil embargo.

giaour 4y ago
> But marking wallets as sanctioned, and threatening any wallets that transact with it to be either similarly sanctioned or subject to heightened scrutiny, would diminish the value of those coins relative to coins which can be freely traded with anyone Doesn't this already happen? Basically any bitcoin that comes out of a tumbler or any wallet address that has transacted with tumbled coins is banned on KYC exchanges: https://sethforprivacy.com/posts/fungibility-graveyard/ https://sethforprivacy.com/posts/fungibility-graveyard/
- randomhodler84 4y ago
  It’s why it’s so important to taint and mix the history of all coins. Given enough time, eventually all UTXOs are tainted, thus nothing is tainted. Most of the supply of BTC can be linked to SR taint from early 2010s. Doesn’t matter now. Litecoin just introduced a sidechain called (mimblewimble extension blocks) MWEB, it permits “cut-through” transactions where UTXOs can mix. It looks like a single UTXO on the main chain. Very Fungible!
  - giaour 4y ago
    What if instead of normalizing money laundering you just didn't launder money?
    - randomhodler84 4y ago
      “What it instead of normalizing privacy, you just don’t have privacy.” The problem is one of pragmatism. All money is dirty. All great fortunes are founded on exploitation. Every dollar in your pocket has been used for crime many times. The system works because we choose to ignore this. If we could programmatically enforce rules, the system would be fail in a day. So it’s not about money laundering, it’s about achieving some kind of pragmatic equivalence, while permitting the system to continue to function.
      - giaour 4y ago
        I guess the problem for me is that the immediate action being normalized is just too ethically suspect. The closest analog outside of the cryptocurrency space is a crime that is generally only committed to get away with another crime. That feels categorically different from, say, normalizing using HTTPS or encrypted messenger apps.
        randomhodler84 4y ago
        It’s the dilemma of cryptography, in that you cannot have a secure system that doesn’t also allow bad guys to use it too. The only victim of weakening a system to fight bad guys are the good guys, as the bad guys will just use the original secure version of the protocol, etc. My point is that eventually the major cryptocurrencies will have some fungibility enhancement mechanisms to deal with the practical limitations of taint and chain analysis. Tornado cash, Coinjoin, MW, etc. Its not about normalization of crime. It’s the default ignorant status quo.
        giaour 4y ago
        > It’s the dilemma of cryptography, in that you cannot have a secure system that doesn’t also allow bad guys to use it too. I hear similar things from the NRA about how we'd all be safer if everyone carried a concealed firearm. I just don't want the world to be a place where we all have to be armed and launder our money after every transaction. There is always a balance that needs to be struck between privacy and accountability. Bob Woodward violated the privacy of the Nixon white house, but we generally believe the public interest there outweighs the privacy concerns at stake. I am always particularly skeptical of financial privacy maneuvers, since they are of considerably greater interest to the already rich and powerful.