4 ms·

I appreciate the general take of: >It seems clear that mixers are used for money laundering, but many tools, perhaps all, can be used for both good and ill. Ty

by aftbit 4y ago

I appreciate the general take of: >It seems clear that mixers are used for money laundering, but many tools, perhaps all, can be used for both good and ill. Typically, however, tools are not prosecuted (or sanctioned), people are. Just because humans have figured out how to cause harm with something does not mean it should be prohibited. Other examples that come to mind include: Tor, encrypted messengers, knives, guns, automobiles, explosives, cleaning chemicals, recreational drugs, cash, and masks.

highwaylights 4y ago
None of those examples exist primarily to aid criminals though, even if they can be used in that way.
- aftbit 4y ago
  IMO the same is true of Tornado Cash and digital currency in general, even though it is often overused by criminals. I have heard strong arguments for each of the following being used primarily or only by criminals: * Tor & encrypted messengers: the whole "going dark" paranoia from mid-2010s * Knives, guns, explosives: mass shootings and domestic terrorists; "nobody needs military style weapons" * recreational drugs: see the War on Drugs which is really a war on poor non-White people * cash: see the death of the €500 note * masks: see the anti-mask laws intended to target the KKK Note that I'm not claiming that society should never be able to regulate tools. Certainly I don't want the disturbed guy down the street making Ricin in his garage. We should keep in mind though that the tools themselves are value-neutral; it is the people who use them that give them a value.
  - highwaylights 4y ago
    Just to reiterate, the primary reason for those items to exist is not criminality, even if they are useful to criminals. This is not true of something like Tornado which exists primarily to launder dirty money, even if it has fringe legitimate use cases.
    - angio 4y ago
      How does TC launder money? It's a privacy tool that hides the origin of cash, but when you cash out through an exchange you still need to prove the origin of cash. It's good to avoid others snoop through my wallet though.
      - highwaylights 4y ago
        I’m not overly familiar so I don’t want to assume something that’s not accurate, but I’m assuming cashing out at an exchange is entirely optional.
  - selfhoster11 4y ago
    >* Tor & encrypted messengers: the whole "going dark" paranoia from mid-2010s It's not paranoia if they really were out to get you (and largely succeeded, it seems)
- Ajedi32 4y ago
  Neither do mixers. They're a privacy tool, just like Tor and end-to-end encryption (both of which also do aid criminals; privacy makes law enforcement harder by its very nature).
  - jldugger 4y ago
    It seems like if you want privacy, the first step is to not use a public ledger.
    - miracle2k 4y ago
      Looking forward to your rigorous defense of Z-Cash/Monero/a future fully private Ethereum then.
  - CharlesW 4y ago
    > Neither do mixers. Let's be honest with ourselves. Mixers are used primarily for crypto transaction laundering.
    - miracle2k 4y ago
      > Let's be honest with ourselves. Mixers are used primarily for crypto transaction laundering. About as true a statement as Tor being primarily used for CSAM, and no-one actually caring about e2e encryption who isn't trying to hide from the law.
      - salawat 4y ago
        >no-one actually caring about e2e encryption who isn't trying to hide from the law. Pity the undesirable, lest one day ye be counted amongst them.
    - aftbit 4y ago
      Leaving aside the legality for the moment, because it's complex, jurisdiction-dependent, and constantly in flux, "crypto transaction laundering" is not in and of itself unethical. It depends on what you are intending to conceal. The parallels to encrypted messaging are really quite strong IMO. If you are trying to hide a purchase (with your own money) from your wife because you think she wouldn't approve, that's totally ethical (if a bit of a silly relationship tactic). Similar if you're trying to hide a donation to an unpopular politician or charity from your employer. If you're trying to hide a donation to a militant organization, it's much more ethically complex and depends on the goals and actions of the organization. If you're trying to hide the source of ill-gotten money, it's likely unethical. Separately, while the tool might be "primarily" used for unethical things, that does not make the tool unethical itself. Again it is the actions of the users that determine this. Even if hypothetically 95% of Tor users are pedophiles and ransomware crackers, that does not invalidate the "legitimate" ethical use of the tool by the remaining 5%.
- thrownaway89865 4y ago
  Most of people who used Tornado Cash are not criminals. How can you say it exists "primarily to aid criminals"? A fleeing criminal breaks into your house and hides while you are on vacation, apparently it was intended as a hideout for criminals all along...
  - colinmhayes 4y ago
    I don't think you have any evidence of that. I don't either, but my hunch is that most tornadoCash users were criminals.
  - acdha 4y ago
    What are you basing “most” on? It’s kind of hard to tell, after all. Do you think that “most” is roughly the same by volume? I’d bet that there’s a chance a majority of users aren’t breaking local laws, at least if you exclude small scale tax evasion, but it takes an awful lot of people who care enough about privacy to pay extra for it to balance out the $450M USD-equivalent which just one North Korean group is alleged to have laundered. People who care about privacy will use it some of the time if they remember but someone with a lot of stolen money is going to use it every time and that will start to dominate the transaction volume, especially any time gas fees go up and people who don’t need to decide they don’t care that much.
CharlesW 4y ago
> Other examples that come to mind include: Most of those examples are regulated, sometimes heavily.
- kodah 4y ago
  OP isn't against regulation, OP is against prohibition.
forgetfulness 4y ago
This is what the prosecution in the Netherlands is claiming about Tornado Cash as a Software tool: > About the concerns, the development of a tool is not prohibited, but if a tool has been created for the sole purpose of committing criminal acts, for example, to conceal criminal flows of money, then putting online/making available a developed tool may be punishable I guess it all depends on what the bar is on a Dutch court of law to prove that criminal intent, if the developer's defense can successfully argue that the code was made to be generally used for the purposes of privacy rather than made deliberately to be useful to criminals, maybe he can get off the hook. I'd personally draw the line at providing the service rather than the code itself; if there's any relation to the criminals using the service (e.g. direct payment for the service, kickbacks) that's different from merely putting the code on Github for whoever may benefit from it. The Netherlands goes further it seems. Source: https://decrypt.co/107648/writing-code-for-sole-purpose-of-money-laundering-may-be-punishable-fiod https://decrypt.co/107648/writing-code-for-sole-purpose-of-m...
- aftbit 4y ago
  I am very much not a lawyer, and certainly not familiar with the Netherlands legal system, but IMO it seems like "created for the sole purpose of committing criminal acts" would be quite a high bar. Certainly I know of people who used Tornado Cash with no intent to commit any criminal acts, either seeking privacy in legal transactions or just DeFi yield farming the TORN token.
- jsmith45 4y ago
  My understanding is that the main protocol itself does not provide any money to those that developed or deployed it. However, they did set up a governance DAO, where some of the governance coins would be released to those who developed TC, and those coins could then be sold on the open market, allowing them to indirectly profit from developing TC. They could also be operating nodes in the relay network, in which relay nodes agree to pay for the gas used to withdrawal money in exchange for a fee. The initial developers could quite easily be profiting by running some of these relayers.
lern_too_spel 4y ago
And maybe some people have good reason to carry bombs onto planes. The existence of good uses for something is not the standard that we use to make laws. We make laws if the benefits of implementing the law outweigh the harms. There is very little harm to sanctioning TornadoCash, and the benefit is that crime becomes less profitable because the cost of laundering increases.

by aftbit 4y ago

highwaylights 4y ago

None of those examples exist primarily to aid criminals though, even if they can be used in that way.

aftbit 4y ago
IMO the same is true of Tornado Cash and digital currency in general, even though it is often overused by criminals. I have heard strong arguments for each of the following being used primarily or only by criminals: * Tor & encrypted messengers: the whole "going dark" paranoia from mid-2010s * Knives, guns, explosives: mass shootings and domestic terrorists; "nobody needs military style weapons" * recreational drugs: see the War on Drugs which is really a war on poor non-White people * cash: see the death of the €500 note * masks: see the anti-mask laws intended to target the KKK Note that I'm not claiming that society should never be able to regulate tools. Certainly I don't want the disturbed guy down the street making Ricin in his garage. We should keep in mind though that the tools themselves are value-neutral; it is the people who use them that give them a value.
- highwaylights 4y ago
  Just to reiterate, the primary reason for those items to exist is not criminality, even if they are useful to criminals. This is not true of something like Tornado which exists primarily to launder dirty money, even if it has fringe legitimate use cases.
  - angio 4y ago
    How does TC launder money? It's a privacy tool that hides the origin of cash, but when you cash out through an exchange you still need to prove the origin of cash. It's good to avoid others snoop through my wallet though.
    - highwaylights 4y ago
      I’m not overly familiar so I don’t want to assume something that’s not accurate, but I’m assuming cashing out at an exchange is entirely optional.
- selfhoster11 4y ago
  >* Tor & encrypted messengers: the whole "going dark" paranoia from mid-2010s It's not paranoia if they really were out to get you (and largely succeeded, it seems)
Ajedi32 4y ago
Neither do mixers. They're a privacy tool, just like Tor and end-to-end encryption (both of which also do aid criminals; privacy makes law enforcement harder by its very nature).
- jldugger 4y ago
  It seems like if you want privacy, the first step is to not use a public ledger.
  - miracle2k 4y ago
    Looking forward to your rigorous defense of Z-Cash/Monero/a future fully private Ethereum then.
- CharlesW 4y ago
  > Neither do mixers. Let's be honest with ourselves. Mixers are used primarily for crypto transaction laundering.
  - miracle2k 4y ago
    > Let's be honest with ourselves. Mixers are used primarily for crypto transaction laundering. About as true a statement as Tor being primarily used for CSAM, and no-one actually caring about e2e encryption who isn't trying to hide from the law.
    - salawat 4y ago
      >no-one actually caring about e2e encryption who isn't trying to hide from the law. Pity the undesirable, lest one day ye be counted amongst them.
  - aftbit 4y ago
    Leaving aside the legality for the moment, because it's complex, jurisdiction-dependent, and constantly in flux, "crypto transaction laundering" is not in and of itself unethical. It depends on what you are intending to conceal. The parallels to encrypted messaging are really quite strong IMO. If you are trying to hide a purchase (with your own money) from your wife because you think she wouldn't approve, that's totally ethical (if a bit of a silly relationship tactic). Similar if you're trying to hide a donation to an unpopular politician or charity from your employer. If you're trying to hide a donation to a militant organization, it's much more ethically complex and depends on the goals and actions of the organization. If you're trying to hide the source of ill-gotten money, it's likely unethical. Separately, while the tool might be "primarily" used for unethical things, that does not make the tool unethical itself. Again it is the actions of the users that determine this. Even if hypothetically 95% of Tor users are pedophiles and ransomware crackers, that does not invalidate the "legitimate" ethical use of the tool by the remaining 5%.
thrownaway89865 4y ago
Most of people who used Tornado Cash are not criminals. How can you say it exists "primarily to aid criminals"? A fleeing criminal breaks into your house and hides while you are on vacation, apparently it was intended as a hideout for criminals all along...
- colinmhayes 4y ago
  I don't think you have any evidence of that. I don't either, but my hunch is that most tornadoCash users were criminals.
- acdha 4y ago
  What are you basing “most” on? It’s kind of hard to tell, after all. Do you think that “most” is roughly the same by volume? I’d bet that there’s a chance a majority of users aren’t breaking local laws, at least if you exclude small scale tax evasion, but it takes an awful lot of people who care enough about privacy to pay extra for it to balance out the $450M USD-equivalent which just one North Korean group is alleged to have laundered. People who care about privacy will use it some of the time if they remember but someone with a lot of stolen money is going to use it every time and that will start to dominate the transaction volume, especially any time gas fees go up and people who don’t need to decide they don’t care that much.

CharlesW 4y ago

> Other examples that come to mind include: Most of those examples are regulated, sometimes heavily.

kodah 4y ago
OP isn't against regulation, OP is against prohibition.

forgetfulness 4y ago

This is what the prosecution in the Netherlands is claiming about Tornado Cash as a Software tool: > About the concerns, the development of a tool is not prohibited, but if a tool has been created for the sole purpose of committing criminal acts, for example, to conceal criminal flows of money, then putting online/making available a developed tool may be punishable I guess it all depends on what the bar is on a Dutch court of law to prove that criminal intent, if the developer's defense can successfully argue that the code was made to be generally used for the purposes of privacy rather than made deliberately to be useful to criminals, maybe he can get off the hook. I'd personally draw the line at providing the service rather than the code itself; if there's any relation to the criminals using the service (e.g. direct payment for the service, kickbacks) that's different from merely putting the code on Github for whoever may benefit from it. The Netherlands goes further it seems. Source: https://decrypt.co/107648/writing-code-for-sole-purpose-of-money-laundering-may-be-punishable-fiod https://decrypt.co/107648/writing-code-for-sole-purpose-of-m...

aftbit 4y ago
I am very much not a lawyer, and certainly not familiar with the Netherlands legal system, but IMO it seems like "created for the sole purpose of committing criminal acts" would be quite a high bar. Certainly I know of people who used Tornado Cash with no intent to commit any criminal acts, either seeking privacy in legal transactions or just DeFi yield farming the TORN token.
jsmith45 4y ago
My understanding is that the main protocol itself does not provide any money to those that developed or deployed it. However, they did set up a governance DAO, where some of the governance coins would be released to those who developed TC, and those coins could then be sold on the open market, allowing them to indirectly profit from developing TC. They could also be operating nodes in the relay network, in which relay nodes agree to pay for the gas used to withdrawal money in exchange for a fee. The initial developers could quite easily be profiting by running some of these relayers.

lern_too_spel 4y ago

And maybe some people have good reason to carry bombs onto planes. The existence of good uses for something is not the standard that we use to make laws. We make laws if the benefits of implementing the law outweigh the harms. There is very little harm to sanctioning TornadoCash, and the benefit is that crime becomes less profitable because the cost of laundering increases.