51–60 of 126 posts
This is why Bitcoin's traceability is a problem for it's money status. If people are actively pursuing the stolen bitcoins, regardless of who's currently holding them, then Bitcoin's fungibility will break as some coins will be worth more than others. The only cryptocurrency that comes close to solving this is Monero, which isn't traceable. If the attackers were smart, this is what they would've done: Send them to Bi…
Greenbacks seem to do fine despite the existence of marked bills.
Earlier quoted context omitted.
But where does this stop, legally? (Really asking, I don't know.) If you immediately used these bills to buy a different car, then I imagine that could be reversed. But if you (say) paid your laundromat repair-man his salary with these bills, for the next few years, surely he (and his landlord, and his local grocery store) would be in the clear? Edit: after reading TFA, this is the crucial point (in English law, I gu…
The limit is practical, not legal. (IANAL). In practice, the law is not trying to 'get' people who innocently receive stolen money or goods. In the example you gave, it would be up to prosecutorial discretion what to do; trying to claw back one salary's worth of already-spent money is probably not worthwhile. But if someone shows up and tries to deposit a couple grand worth of marked bills, they can expect to be take…
This is different than recieving other types of stolen goods that haven't been given this special legal status, which ensures that money is fungible and can be accepted with relatively little concern by honest people.
Earlier quoted context omitted.
The article states that is not how money (unlike other types of property) works: > Banknotes, coins, and other highly-liquid paper instruments have a very special legal status. If you unknowingly accept some banknotes from someone who just obtained them illegally (say via ransom or theft), the law can't compel you to give those banknotes back to the original victim. Money, as the great British jurist Lord Mansfield o…
The article may state that, but it's pretty clearly not the case in all jurisdictions: > The penalty for larceny and the crime of receiving and concealing stolen property in Michigan depends upon the value of the substantiated property or money involved. https://www.cyabdolaw.com/larceny-and-receiving-stolen-prope...
It says nothing about the need to return stolen money recieved as part of a legitimate seeming transaction.
There already is such tracking going on, exchanges do freeze balances sometimes. The problem is that if the stolen coin gets traded before exchanges can freeze them you wind up with a lot of innocent people holding those coins and it's not practical to freeze those later. Consider these two scenarios: A stolen bike vs a stolen sack of coffee. In the case of the bike, if you can find it you can take it back from someo…
> If you were to make the coffee vendors or their customers liable for stolen beans they happen to touch then you can't have a functioning coffee market at all. That's not true. It just means that reputation, verification and insurance become critical to the coffee market and that friction makes the coffee market way less liquid. Now, legislatures and courts may choose to provide indemnity to all unknowing parties to…
That is true, but generally everyone wants commodities markets to be low friction and liquid. Your point is well taken that maybe some governments would rather cryptocurrency markets be higher friction.
Also keep in mind that governments put regulations at points that tend to attract problems. Pawn shops in many places are required to keep records that other private buyers and sellers are not required to keep for the very same items.
> Now, legislatures and courts may choose to
Yes, and how this currently works now depends on what choices they have already made regarding stolen property.
In a lot of places the distinction is whether the property is absolutely identifiable as the stolen property. So in the case of a car, iPad, piece of jewelry or similar it is clear. If Malory steals the iPad belonging to Alice and then sells it to Bob then Alice can legally take the iPad from Bob if she can find it. Getting the money back from Malory is Bob's problem now. On the other hand if Malory steals and sandwich from Alice, sell it to Bob, and Bob eats it, then Alice cannot legally force Bob to compensate her. If Bob sold the iPad to Charlie Alice has to take it up with him, she can't make Bob hand over the money Charlie paid.
> I would not be surprised to see laws in the not too distant future
That may happen or may not, but right now the status quo is that once things have been disposed of by an innocent party the innocent party isn't forced to make restitution. Again, I am not going to claim this is how it works in every country on earth, but it is in the places I am familiar with.
Earlier quoted context omitted.
Because, like with mixing services, ZCash shielded transactions are opt-in and can easily be detected. So exchanges could decide to ban coins with mixing in their history or require extensive KYC information. Yes it's a little different from the problem described in the post, but it's another facet of the fungibility issue.
> So exchanges could decide to ban coins with mixing in their history or require extensive KYC information. The same way they could decide to ban Monero... seems like what you describe with z-cash is more complex to support in an exchange than simply removing a whole cryptocurrency, thus is less likely to happen.
Earlier quoted context omitted.
How can you launder something with a traceable serial/transaction number? I don’t think it’s possible. The best you can do is mix it with enough other transactions that it becomes murky as to the final destinations. Ex: If half of the bitcoins used to buy a car were fraudulent, would you need to return half the car?
The point isn't to make the coins themselves clean, it's to exchange them for something clean. So a laundering service could specialize in buying tainted coins and to sell them off to other unsuspecting people, pocketing the difference. In return they could provide clean coins for their customers.
If Bitcoin isn't granted money status, that would suck. We can't hold downstream buyers accountable for the money. However, I still see this as a good thing; if the hackers did sell 96 Bitcoin to one single buyer, then we can now start a paper trail (or physical evidence) on what the single buyer gave them in return (paper money transfer?)
"We" absolutely can. If one were to sell a sports car in exchange for a pile of marked bills taken from a bank robbery, one would rapidly find oneself in hot water. Receiving stolen goods is a crime.
Fascinating and also good news IMHO as it starts to highlight that bitcoins can be tracked and today a stolen mobile phone can be blocked and logged upon a database as stolen, so could bitcoins. I'm thinking that there is a need/opportunity to be able to register bitcoins as stolen and if vendors used that database, the whole raft of bitcoins used for nefarious activities and more so stolen ones, can be curtailed. Co…
An evildo-er wanting to hide bitcoins has many routes to do so: * A Mixer * gamble on one of many online casinos * buy physical darknet goods with them * Hack someones account on an exchange and use it. * The above, but use the coins to 'pump-n-dump' a tiny altcoin. Be one of many 'investors' making money out of the change in altcoin price. * Go margin trading with them, but make sure to loose them all in a margin ca…
What if governments define every output to a mixer transaction to count as receiving stolen goods if any of the inputs are the result of criminal activity? Apart from that, every option you suggested just hands the problem off to the next person. Eventually people won't want to transact at all because they don't want to receive tainted bitcoins.
An evildo-er wanting to hide bitcoins has many routes to do so: * A Mixer * gamble on one of many online casinos * buy physical darknet goods with them * Hack someones account on an exchange and use it. * The above, but use the coins to 'pump-n-dump' a tiny altcoin. Be one of many 'investors' making money out of the change in altcoin price. * Go margin trading with them, but make sure to loose them all in a margin ca…
What if governments define every output to a mixer transaction to count as receiving stolen goods if any of the inputs are the result of criminal activity? Apart from that, every option you suggested just hands the problem off to the next person. Eventually people won't want to transact at all because they don't want to receive tainted bitcoins.