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Someone with a better understanding of Bitcoins please correct me here if I'm wrong. But if I understand things correctly, mining is one way (the only way?) to

Someone with a better understanding of Bitcoins please correct me here if I'm wrong. But if I understand things correctly, mining is one way (the only way?) to get untraceable Bitcoins because they're created out of thin air by the network. By paying your electricity bill to run a miner, you're effectively converting your local currency into Bitcoins. As as long as you credit the mining reward to a wallet that has no connection to your real-world finances, and take other safety precautions, those coins would not be traceable to you. So this could be used to launder money through the Bitcoin network. The only evidence that you were doing something would be an abnormally large electricity bill. Mind you, without this turning into Office Space, I'm sure there's more effective ways to launder money... But if that's true, then I would expect the supply of mining capacity to settle above the point where it's profitable, because some fraction of miners don't really care about being profitable as long it's a reasonable loss.

bdcravens 13y ago
That's one way of looking at it. Keep in mind that it's not uncommon for electric companies to report huge jumps in electricity usage to the police, as high bills are considered evidence of marijuana growth, and have led to serious busts.
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jessaustin 13y ago
It's my impression that obtaining BTC isn't the interesting problem for most would-be launderers. After all, you just have to sell some CC #s or provide custom DDOS services or do whatever nefarious shit you do that makes laundering a good idea, and presto you have BTC. The real problem is trading those fat stacks of BTC for fast cars, palatial mansions, the intimate attentions of beautiful people, etc. without the fuzz connecting those riches back to the nefarious shit that earned them. That is, as for regular money laundering, the trick is make dirty funds clean. It's actually straightforward to obtain dirty funds in the first place, for a criminal. See here for more on this topic: https://news.ycombinator.com/item?id=6291546 https://news.ycombinator.com/item?id=6291546

bdcravens 13y ago

That's one way of looking at it. Keep in mind that it's not uncommon for electric companies to report huge jumps in electricity usage to the police, as high bills are considered evidence of marijuana growth, and have led to serious busts.

deleted 13y ago

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jessaustin 13y ago

It's my impression that obtaining BTC isn't the interesting problem for most would-be launderers. After all, you just have to sell some CC #s or provide custom DDOS services or do whatever nefarious shit you do that makes laundering a good idea, and presto you have BTC. The real problem is trading those fat stacks of BTC for fast cars, palatial mansions, the intimate attentions of beautiful people, etc. without the fuzz connecting those riches back to the nefarious shit that earned them. That is, as for regular money laundering, the trick is make dirty funds clean. It's actually straightforward to obtain dirty funds in the first place, for a criminal. See here for more on this topic: https://news.ycombinator.com/item?id=6291546 https://news.ycombinator.com/item?id=6291546