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Drug dealers have tons of cash they can't put in a bank, per government regulations on disclosure. People with tons of bitcoins may want to cash out a part of
by pdq 13y ago
Drug dealers have tons of cash they can't put in a bank, per government regulations on disclosure. People with tons of bitcoins may want to cash out a part of their nest egg.
They get together and trade cash for BTC. Now the dealers can go on any exchange, and convert the BTC back to digital currency, then can transfer into their bank.
- new_test 13y agoThat doesn't make sense to me. You're saying the banks won't let the criminal put their cash in the bank, but if the criminal converts the cash to bitcoins and back to real money they somehow will? Either way I don't think places like Dubai or Switzerland have any problem with Russian drug money.
- acgourley 13y agoIt's easier to drip out as you need it, which is less suspicious
- shiftpgdn 13y agoOr exchange for goods outside the traditional financial system.
- rdl 13y agoPhysical cash to local bitcoins (placement); send bitcoins abroad and/or invest them in a bitcoin related busines (layering, integration), report bitcoin profits in that jurisdiction and bring them into banking system (integration).
- tlrobinson 13y agothen can transfer into their bank. I agree with you until this point. Banks will still be able to apply the same safeguards they use when customers deposit large amounts of cash (reporting large transactions, "suspicious" activity, etc) Same goes with certain type of merchants such as precious metal dealers. I don't know if other merchants that deal with large transactions need to report large cash transactions (casinos, car dealerships, etc?) Bitcoin is really no different than cash in this respect, except it's easier to move but actually more traceable since the blockchain is entirely public.