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Why the feds took down one of Bitcoin’s largest exchanges

theverge.com

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Re: Why the feds took down one of Bitcoin’s largest exchanges

#11

Post by ithought »

The charges seem exaggerated. If he's responsible or directly involved in the Mt. Gox theft, then they should prosecute him for that. The referencing of Internet usernames as evidence of crimes indicates they have a weak case or they're using it as public relations campaign against bitcoin.

The price of Litecoin was usually higher on btc-e I think solely because people would deposit btc and buy ltc as a way to hide the source of their coins. It was widely considered shady but trustworthy by its longevity.

Re: Why the feds took down one of Bitcoin’s largest exchanges

#12

Post by TylerE »

ineedasername wrote: post #8

This is what I never understood about bitcoins's reputation, especially earlier on, about its supposed anonymity. I suppose that's much less the case now. But it always seemed odd that people considered it at all anonymous when the blockchain kept a record of everything. Sure it might not be immediately identifiable with a specific individual, but unless it was a wholly closed system, entry & exit points would always…

Anonymous != Untraceable.

Anonymous means, well, anonymous.

Re: Why the feds took down one of Bitcoin’s largest exchanges

#13

Post by stale2002 »

ineedasername wrote: post #8

This is what I never understood about bitcoins's reputation, especially earlier on, about its supposed anonymity. I suppose that's much less the case now. But it always seemed odd that people considered it at all anonymous when the blockchain kept a record of everything. Sure it might not be immediately identifiable with a specific individual, but unless it was a wholly closed system, entry & exit points would always…

The technology is getting better and better.

These days there are things like mixers that make it extremely difficult to track.

There are even crytocurrencies where mixing is built in and every transaction effectively goes through a mixer.

Re: Why the feds took down one of Bitcoin’s largest exchanges

#14

Post by eadz »

These domain name seizures from non US-resident entities keep coming.

But more worryingly, "The language in the indictment about BTC-e’s “criminal design” mimics the indictment against Liberty Reserve".

This also mimics the Kim DotCom / MegaUpload take down, along with a likely "FBI" operation in a foreign country.

It seems there is now a policy of taking down things that are "criminal in design" - waiting for the next raid on "criminal in design" encryption software...

Re: Why the feds took down one of Bitcoin’s largest exchanges

#16

Post by ethbro »

ineedasername wrote: post #8

This is what I never understood about bitcoins's reputation, especially earlier on, about its supposed anonymity. I suppose that's much less the case now. But it always seemed odd that people considered it at all anonymous when the blockchain kept a record of everything. Sure it might not be immediately identifiable with a specific individual, but unless it was a wholly closed system, entry & exit points would always…

Randomly swapping coins is an attempt to address anonymity.

https://en.m.wikipedia.org/wiki/Cryptocurrency_tumbler

Re: Why the feds took down one of Bitcoin’s largest exchanges

#17

Post by abetusk »

ineedasername wrote: post #8

This is what I never understood about bitcoins's reputation, especially earlier on, about its supposed anonymity. I suppose that's much less the case now. But it always seemed odd that people considered it at all anonymous when the blockchain kept a record of everything. Sure it might not be immediately identifiable with a specific individual, but unless it was a wholly closed system, entry & exit points would always…

It's the difference between pseudonymity and anonymity. Saying that I've transferred B bitcoin to identity A doesn't tie that identity to a "real" person, it just says whoever holds A's identity (secret keys) can do other transactions with the bitcoins A holds.

In practice this gets complicated as some exchanges require a valid government ID (drivers license say) and that's why these so-called "tumbling" services sprung up. The idea is that, for a small fee, you put X bitcoin into a pool with other people, and get (X - eps) back out and put into another identity of your choosing (eps being transaction fees). As long as the tumbling service doesn't get compromised so that the destination address can't be tied to the source address, this allows for a level of real world identity protection.

Presumably even sending bitcoin from an identity that's tied to your meat space identity directly to another identity that you create provides a layer of protection.

Re: Why the feds took down one of Bitcoin’s largest exchanges

#18

Post by gruez »

jstanley wrote: post #10
gruez wrote: post #7

Earlier quoted context omitted.

too bad they're more decentralized marketplaces than decentralized exchanges.

https://bisq.io/ is a decentralised exchange.

sorry i didn't clarify in my first post but by "exchange", i mean a place where there is 1 orderbook that every participant uses and transactions are done automatically, rather than some ad-hoc system where participants transact between each other.

exchanges: gdax, bitstamp, nyse

marketplaces: localbitcoins, bitcointalk, otc markets

bitsquare is closer to localbitcoins than bitstamp.

Re: Why the feds took down one of Bitcoin’s largest exchanges

#19

Post by ineedasername »

TylerE wrote: post #12
ineedasername wrote: post #8

This is what I never understood about bitcoins's reputation, especially earlier on, about its supposed anonymity. I suppose that's much less the case now. But it always seemed odd that people considered it at all anonymous when the blockchain kept a record of everything. Sure it might not be immediately identifiable with a specific individual, but unless it was a wholly closed system, entry & exit points would always…

Anonymous != Untraceable. Anonymous means, well, anonymous.

Nice, succinct, seems the essence of the misconception. Thanks :D
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