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The Slow Criminalization of Peer-To-Peer Transfers

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Re: The Slow Criminalization of Peer-To-Peer Transfers

#51

Post by dade_ »

ouid wrote: post #2

The value of bitcoin was always to evade taxes and launder money, both of which are criminal enterprises, the only thing that is changing is enforcement.

And the Internet is for porn, but some of us would like to avoid paying currency exchange fees and would also like a hedge against their local government's currency. Of course, the wild fluctuations in value don't make this much of a reality today, I think the promise is real. Look at all of the people that lost everything during the cuban revolution, argentina, greece.

Re: The Slow Criminalization of Peer-To-Peer Transfers

#53

Post by badosu »

mazamats wrote: post #21
CJefferson wrote: post #17

Earlier quoted context omitted.

No, instead a small set of Chinese miners can obliterate the value instead.

Have you looked at the current hashrate distribution?

I just did, I consulted https://blockchain.info/pools

The 4 top pools are chinese and amount to almost 40% of the latest blocks mined.

Re: The Slow Criminalization of Peer-To-Peer Transfers

#54

Post by Jabanga »

CJefferson wrote: post #17
adrenalinelol wrote: post #4

Earlier quoted context omitted.

Perhaps the value is the fact a central bank can't obliterate the value of the currency based on a whim, using a bunch of esoteric economic logic to justify such policies?

No, instead a small set of Chinese miners can obliterate the value instead.

Miners can't change the issuance schedule. They can only delete blocks and form new ones with valid* transactions, and only if they collude, and are okay with destroying the value of their capital assets.

* transactions where the private key associated with a public key holding value authorizes an outgoing transfer of value.

Re: The Slow Criminalization of Peer-To-Peer Transfers

#55

Post by dllthomas »

cgb223 wrote: post #36
isubkhankulov wrote: post #12

In all of these cases, the bitcoin vendors did not register on FinCEN's website. Registering is simple but by doing so the person/company is required to check ID's of their customers and make sure there is no money laundering involved. Including filing reports with the gov't for any suspicious activity and large cash transactions amongst other things.

How would one launder money with bitcoin? What would that look like?

Buy bitcoin, put in mixer, use it to pay for accounts from your "legitimate" SaaS product.

Re: The Slow Criminalization of Peer-To-Peer Transfers

#56

Post by ajmurmann »

mirimir wrote: post #46
wolco wrote: post #41

Earlier quoted context omitted.

Buy bitcoin using cash at local bitcoin atm. Put bitcoin in a mixer. Cash out bitcoin and declare the income.

The last step doesn't work. I mean, you might as well declare the cash as income. You'd be pressed to explain where either came from. More useful would be to buy Bitcoin with cash, mix, and then invest assets somewhere anonymously. But it's a hard problem, because wherever assets appear in meatspace, there's typically the need to explain their origin. That's where many people get caught. Such as Tomáš Jiříkovský of S…

The problem actually seems worse on the Bitcoin side to new than in meat space. Someone might have a Saas business that receives a lot of payments in BTC. Interestingly there isn't all that much traffic. You know like in mani pedi salons that make surprising amounts of money despite never being really packed. It's harder to notice that with a Saas business especially if the logs aren't kept for long. However, it would be strange to see that most of the customers BTC addresses only ever received money from a source other than an exchange and all just used it to pay for the Saas. It would be easier to launder money by just allowing "customers" to pay by mailinh cash to a PO box.

Re: The Slow Criminalization of Peer-To-Peer Transfers

#57

Post by Houshalter »

roguecoder wrote: post #32

If we want to draw the connection to cash, companies that trade in large amounts of cash are also subject to regulation and reporting. For example, U.S. financial institutions are required to file Currency Transaction Reports for deposit, withdrawal, exchange of currency, or other payment or transfer that involves more than $10,000. Any organization that is facilitating those trades is subject to financial regulation…

You are right that they are treating it similarly to cash. The problem is that our society is slowly criminalizing cash as well. If cops catch you with a large amount of cash, they can just take it with no recourse. It's assumed to be for criminal activity, since why else would anyone transport cash? Using cash is increasingly seen as suspicious and possibly criminal behavior. If you deposit a large amount of cash it's reported to the government and you may even be investigated. Some other comments below have better examples.

The government stopped printing large bills and inflation is slowly going to make the smaller bills worthless. The same also applies to laws. The law says "any amount over $10,000 needs to be reported". And as inflation continues, the actual amount of value that represents becomes smaller and smaller from what it was when the law was originally written.

Re: The Slow Criminalization of Peer-To-Peer Transfers

#58

Post by firethief »

roguecoder wrote: post #32

If we want to draw the connection to cash, companies that trade in large amounts of cash are also subject to regulation and reporting. For example, U.S. financial institutions are required to file Currency Transaction Reports for deposit, withdrawal, exchange of currency, or other payment or transfer that involves more than $10,000. Any organization that is facilitating those trades is subject to financial regulation…

> accused of illegally selling more than $1,500 in bitcoins

Unless I'm missing something, the threshold for reporting Bitcoin transactions is apparently now a fraction of that for cash (if there even is a threshold?).

Re: The Slow Criminalization of Peer-To-Peer Transfers

#59

Post by firethief »

wmf wrote: post #31
mahyarm wrote: post #26

Earlier quoted context omitted.

I found it useful for lower costs in sending money across country and currency borders. Someone will reply and say it's not actually cheaper, but what is available for the average joe it is definitely cheaper. It's also faster and more convenient if both sides have bitcoin exchange accounts.

One may wonder, however, why traditional money transfer is more expensive if it doesn't even require mining. Is it because of regulations by any chance?

Regulatory capture. It's not easy to open a competing bank.

Re: The Slow Criminalization of Peer-To-Peer Transfers

#60

Post by firethief »

joering2 wrote: post #35
Jabanga wrote: post #28

Earlier quoted context omitted.

Peer-to-peer electronic cash has numerous uses beyond tax evasion and money laundering, just as physical cash does. But to your point, even these laws are part of a new trend. Money laundering is a relatively new crime, and widespread taxation of private transactions only came into force in the early 20th century, with governments around the world instituting income taxation. 50 years ago, almost all transactions wer…

It is also important to say that the trend of making you most likely criminal "because you use cash" will continue. It is already known restaurants owners are getting in trouble for small deposits. Its not even $10,000 or $9,000 you deposit.. if you happen to make daily deposits of even few hundred dollars you are guilty of "structuring" aka smurfing. Another thing is to make sure you can track back your physical hoa…

He might have been better off laundering it.
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