6 ms·

And how would this work in practice. Let's assume you have one "clean" Bitcoin and I have one stolen/flagged Bitcoin. I'm now sending you 0.1 Bitcoins and you d

by gst 13y ago

And how would this work in practice. Let's assume you have one "clean" Bitcoin and I have one stolen/flagged Bitcoin. I'm now sending you 0.1 Bitcoins and you don't know that those are flagged. So how would this influence your remaining Bitcoins? If you send 0.1 Bitcoins to someone else: Would you sell the stolen Bitcoins first? Would you sell the clean Bitcoins first? Are all of your coins tainted by a given percentage? (Yes, I know that just receiving those coins would create a separate input that you can ignore in order to avoid tainting your coins. But at some point clean and flagged input will be merged together into a single one.)

eterm 13y ago
You sell the clean first. You are assumed to always be holding 0.1 dirty coins, so you must keep a balance > 0.1 at all times to avoid spending the dirty coins.
- gst 13y ago
  So now let's assume I'm selling something on an auction site and someone pays me with coins where I assume it's likely that they are stolen (but I don't have any definite knowledge about that). For some reason I now need to refund the buyer. Do I now first need to transfer all but 0.1 coins to somewhere else, so that I can send the remaining 0.1 coins back?
  - eterm 13y ago
    Why are you dealing with money that you're assuming that is likely stolen? If they turn out blacklisted then you're out of pocket. Because bitcoin does not support refunds or chargebacks you must transfer clean money to refund them. Bitcoin has weaknesses, the way it deals with "change" and indeed the need for change is one of them. Bitcoin should have dealt with the change issue by instead of the splitting happening at the receiver end and sending back change, the splitting should have happened at the sender end so only the correct amounts were ever sent.
    - yebyen 13y ago
      That's not really how it works. The sender does the splitting, but he has to send the change somewhere, and customarily it's sent to a new address. The receiver doesn't even have to be online, you don't get your change from them, so the only way you'd get blacklisted coins in change is if you already had some blacklisted coins in the inputs you were using to begin with.
  - Dylan16807 13y ago
    >Do I now first need to transfer all but 0.1 coins to somewhere else, so that I can send the remaining 0.1 coins back? You make it sound like this is a burden. It seems easy to me, as long as you track taint per-output rather than per address. Just pretend people followed best practices and used a unique address for every output. So let's take eterm's suggestion that clean coins always come out first. So all we need to do is build a transaction with at least .1 tainted coins, put the non-refund coins as the first output, and put the .1 tainted coins as the second output. First output is an address we control, second output goes back to the person we're refunding. That's assuming you already mixed up your coins and can't just send back the exact same transaction they sent you in the first place.
- pbhjpbhj 13y ago
  Can't you do two simultaneous transactions? At all times you're doing a transaction with an untransacted balance > 0.1.
natrius 13y ago
Every wallet that receives funds from the flagged wallet is tainted until they send it back to that wallet. All of the funds, not just the tainted amount.
- gst 13y ago
  This doesn't work in practice. Transactions using Bitcoin "addresses" are just one (out of many) transaction types. As far as I understand the protocol it's possible that you receive those coins via a transaction type that doesn't have an associated Bitcoin sender address.
  - dllthomas 13y ago
    "Every wallet that receives funds from a tainted wallet becomes tainted" doesn't (in any way I see) conflict with the notion that there are transactions without a sender.
    - gst 13y ago
      I meant the "until you send it back part". If "every wallet becomes tainted" and "you can't send it back" this would make it trivial for an attacker to taint a large number of wallets in the Bitcoin network.
      - dllthomas 13y ago
        If there is no sender, how does the receiver become tainted?
- dllthomas 13y ago
  "[...] until they send it back to that wallet." Or forfeit it to the feds, at which point they can mark them untainted before they auction them off.
  - pbhjpbhj 13y ago
    Doesn't tainting then become "assigning to the USA government"? Why should that be the case?
deleted 13y ago
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by gst 13y ago

eterm 13y ago

You sell the clean first. You are assumed to always be holding 0.1 dirty coins, so you must keep a balance > 0.1 at all times to avoid spending the dirty coins.

gst 13y ago
So now let's assume I'm selling something on an auction site and someone pays me with coins where I assume it's likely that they are stolen (but I don't have any definite knowledge about that). For some reason I now need to refund the buyer. Do I now first need to transfer all but 0.1 coins to somewhere else, so that I can send the remaining 0.1 coins back?
- eterm 13y ago
  Why are you dealing with money that you're assuming that is likely stolen? If they turn out blacklisted then you're out of pocket. Because bitcoin does not support refunds or chargebacks you must transfer clean money to refund them. Bitcoin has weaknesses, the way it deals with "change" and indeed the need for change is one of them. Bitcoin should have dealt with the change issue by instead of the splitting happening at the receiver end and sending back change, the splitting should have happened at the sender end so only the correct amounts were ever sent.
  - yebyen 13y ago
    That's not really how it works. The sender does the splitting, but he has to send the change somewhere, and customarily it's sent to a new address. The receiver doesn't even have to be online, you don't get your change from them, so the only way you'd get blacklisted coins in change is if you already had some blacklisted coins in the inputs you were using to begin with.
- Dylan16807 13y ago
  >Do I now first need to transfer all but 0.1 coins to somewhere else, so that I can send the remaining 0.1 coins back? You make it sound like this is a burden. It seems easy to me, as long as you track taint per-output rather than per address. Just pretend people followed best practices and used a unique address for every output. So let's take eterm's suggestion that clean coins always come out first. So all we need to do is build a transaction with at least .1 tainted coins, put the non-refund coins as the first output, and put the .1 tainted coins as the second output. First output is an address we control, second output goes back to the person we're refunding. That's assuming you already mixed up your coins and can't just send back the exact same transaction they sent you in the first place.
pbhjpbhj 13y ago
Can't you do two simultaneous transactions? At all times you're doing a transaction with an untransacted balance > 0.1.

natrius 13y ago

Every wallet that receives funds from the flagged wallet is tainted until they send it back to that wallet. All of the funds, not just the tainted amount.

gst 13y ago
This doesn't work in practice. Transactions using Bitcoin "addresses" are just one (out of many) transaction types. As far as I understand the protocol it's possible that you receive those coins via a transaction type that doesn't have an associated Bitcoin sender address.
- dllthomas 13y ago
  "Every wallet that receives funds from a tainted wallet becomes tainted" doesn't (in any way I see) conflict with the notion that there are transactions without a sender.
  - gst 13y ago
    I meant the "until you send it back part". If "every wallet becomes tainted" and "you can't send it back" this would make it trivial for an attacker to taint a large number of wallets in the Bitcoin network.
    - dllthomas 13y ago
      If there is no sender, how does the receiver become tainted?
dllthomas 13y ago
"[...] until they send it back to that wallet." Or forfeit it to the feds, at which point they can mark them untainted before they auction them off.
- pbhjpbhj 13y ago
  Doesn't tainting then become "assigning to the USA government"? Why should that be the case?

deleted 13y ago

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