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Anyone wanting to use their stolen bitcoins will likely have to interact with people in meat space though. Be it going through an exchange which will necessari

by Crito 13y ago

Anyone wanting to use their stolen bitcoins will likely have to interact with people in meat space though. Be it going through an exchange which will necessarily need their information to get them their money, buying drugs, selling them locally, etc. I mean, how much of half a billion are these thieves going to spend on anonymous VPNs and tipping people on reddit? Sooner or later, somebody sitting on 500MM is going to start itching for a few kilos of coke or a new yacht. And mixers? Anyone who's stolen 500MM worth of bitcoins probably won't trust mixers... I sure as hell wouldn't if it were me because if I were running a mixer and saw those coins, I'd steal them again myself. Why the hell not steal from a thief? I figure there are two ways this will play out: 1) The thief does nothing with the coins and goes uncaught, having performed the theft only 'for the lulz'. 2) The thief begins using the coins, and eventually somebody somewhere catches up with him. Hopefully for the thief, the law catches him first. I don't think decentralized issuing authority is important to whether or not the legal system can effectively prosecute thieves. The general anti-government attitude may preclude victim cooperation with law enforcement, but I think in this particular case there is too much money at stake to bet on all of the victims taking an ideological stance against using every tool at their disposal. (Keep in mind that by no means all* of the MtGox victims are crypto-anarchists or anarcho-capitalists. There are plenty of regular hapless "investors" too, or just regular old technology enthusiasts who like playing around with new technology. There isn't really a shared bitcoin mentality or political stance, only perhaps a majority that share vaguely similar libertarian-bent ideas.)

MichaelGG 13y ago
Why wouldn't a mixer steal from a thief? To keep their credibility? To continue to get business? If you're gonna get a 3% cut to launder a lot of BTC, are you gonna just jack the entire first 100BTC order? Or let it pass and keep your 3BTC and hope for repeat business? Of course you wouldn't send all the BTC at once through the mixer in one transaction.
- Crito 13y ago
  That's why a mixer wouldn't steal from a small-fry thief. But a chance at 6% of all bitcoins? Every man has his price, and mine is far lower than that. I'd sooner take even a fraction of that then continue a 3% cut of day-to-day transactions. To avoid the mixer stealing from him, the thief could split the stash and send it to many different mixers, but he would be taking the chance that the mixers are not actually run by the same person, and that the people running the mixers do not communicate with each other. If I went through the hassle to set up a mixer, I would be sure to do it several times over just in case this very thing ever happened to me. What would I do with the tainted bitcoins after stealing them from the thief? Probably just sit on them. Sit on them on the off-chance that I ever became desperate enough to attempt to use them.
  - MichaelGG 13y ago
    Where do you get "6% of all bitcoins"? Why would the thief send them all at once? If I was trying to launder a ton of money, the first thing I would do is not hand the entire sum to other parties. So, bit by bit, the "thief" sends 100 BTC through a mixer. A mixer only has the opportunity to steal 100 BTC and lose reputation/opportunity at any given time. There's no way to get "6% of all bitcoins". It doesn't matter if one person owns all mixers. The thief doesn't have to send all the money at once. Send 100BTC a day. Maybe on 4 different providers. Max exposure: 1200BTC (assuming 100 BTC on 4 mixers, 3 days per mixer). And in a year, 100K BTC is laundered. (This is assuming mixers actually work, which I'm skeptical of, especially for large amounts.)
    - Crito 13y ago
      > Where do you get "6% of all bitcoins"? Is that not what was stolen? I haven't been paying much attention to the details.
      - MichaelGG 13y ago
        Yes supposedly that's the stolen amount. I'm asking how you go from that to a mixer getting access to the 6% in its entirety. One would need to be colossally impaired to take _all_ their earnings and put them anywhere at once. Personally I'd keep 90% or more in an offline wallet stored in many places. Then slowly launder a bit of it at a time...

by Crito 13y ago

MichaelGG 13y ago

Why wouldn't a mixer steal from a thief? To keep their credibility? To continue to get business? If you're gonna get a 3% cut to launder a lot of BTC, are you gonna just jack the entire first 100BTC order? Or let it pass and keep your 3BTC and hope for repeat business? Of course you wouldn't send all the BTC at once through the mixer in one transaction.

Crito 13y ago
That's why a mixer wouldn't steal from a small-fry thief. But a chance at 6% of all bitcoins? Every man has his price, and mine is far lower than that. I'd sooner take even a fraction of that then continue a 3% cut of day-to-day transactions. To avoid the mixer stealing from him, the thief could split the stash and send it to many different mixers, but he would be taking the chance that the mixers are not actually run by the same person, and that the people running the mixers do not communicate with each other. If I went through the hassle to set up a mixer, I would be sure to do it several times over just in case this very thing ever happened to me. What would I do with the tainted bitcoins after stealing them from the thief? Probably just sit on them. Sit on them on the off-chance that I ever became desperate enough to attempt to use them.
- MichaelGG 13y ago
  Where do you get "6% of all bitcoins"? Why would the thief send them all at once? If I was trying to launder a ton of money, the first thing I would do is not hand the entire sum to other parties. So, bit by bit, the "thief" sends 100 BTC through a mixer. A mixer only has the opportunity to steal 100 BTC and lose reputation/opportunity at any given time. There's no way to get "6% of all bitcoins". It doesn't matter if one person owns all mixers. The thief doesn't have to send all the money at once. Send 100BTC a day. Maybe on 4 different providers. Max exposure: 1200BTC (assuming 100 BTC on 4 mixers, 3 days per mixer). And in a year, 100K BTC is laundered. (This is assuming mixers actually work, which I'm skeptical of, especially for large amounts.)
  - Crito 13y ago
    > Where do you get "6% of all bitcoins"? Is that not what was stolen? I haven't been paying much attention to the details.
    - MichaelGG 13y ago
      Yes supposedly that's the stolen amount. I'm asking how you go from that to a mixer getting access to the 6% in its entirety. One would need to be colossally impaired to take _all_ their earnings and put them anywhere at once. Personally I'd keep 90% or more in an offline wallet stored in many places. Then slowly launder a bit of it at a time...