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'50% of transactions were fraudulent' when Steam accepted Bitcoin for payments

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Re: '50% of transactions were fraudulent' when Steam accepted Bitcoin for payments

#141

Post by UncleMeat »

m348e912 wrote: post #126
rosndo wrote: post #88

Earlier quoted context omitted.

The basic misunderstanding is on your part. “Money laundering” wasn’t mentioned by anyone but you. Stop inventing things. This is about valve getting fucked because they were accepting bitcoin payments with zero confirmations.

I'd like to know what Gabe meant by fraudulent too. The whole idea of crypto is that if you send it and it's confirmed you can't get it back, which makes fraud (on the payers side) nearly impossible. You brought up the point about zero confirmations. Zero-conf itself is fairly reliable, it certainly doesn't account for 50% transactions being fraudulent. Bitcoin introduced replace by fee in 2016. In 2017, bitcoin tran…

> The whole idea of crypto is that if you send it and it's confirmed you can't get it back, which makes fraud (on the payers side) nearly impossible.

I consider "obtained somebody's credentials or private key through illegal means and then used that to purchase a good with stolen BTC" to be fraud. That the network considers this to be a normal transaction is not relevant.

Re: '50% of transactions were fraudulent' when Steam accepted Bitcoin for payments

#142

Post by TrapLord_Rhodo »

reaperducer wrote: post #91
TrapLord_Rhodo wrote: post #77

Earlier quoted context omitted.

I don't think i've ever run into one here in the US that didn't let me use my crypto card. I don't even remember the last time i carried cash?

I'm in the U.S., too. You must not go very many interesting places, or find yourself in very many interesting situations. I guess maybe a crypto debit card is good for people who lead plain lives. Like hanging around town and going to the movies and the candy store. But I require both cash and a real credit card for my life. Debit cards have failed me too often.

Okay - but now we are really picking at semantics here, aren't we? If i changed my answer to everywhere who accepts a debit card can accept crypto, does it really change the sentiment of what i'm trying to convey?

Because at that point i can go on a tangent and say well, the USD is actually accepted at less places than BTC because i can use my debit card in mexico but you can't use USD.

Re: '50% of transactions were fraudulent' when Steam accepted Bitcoin for payments

#143

Post by doomroot »

Context on what I believe they mean by "fraudulent".

Steam back in the day used to accept 0 confirmation bitcoin spends. This means that the transaction has been gossiped on the bitcoin p2p network but had not yet been mined into a block and thus had minimal finality guarantees. Steam could see that they were going to receive a bitcoin payment (when the transaction was mined into a block) and would credit the users account instantly for a better purchase UX.

Turns out anyone with some deeper understanding of bitcoin could construct another transaction spending the same bitcoin back to themselves before their original transaction was ever put in a block. The bitcoin community moved away from accepting '0 conf' transactions pretty much everywhere because of this reason.

In fact the high fee era (2016-2018) saw many wallets incorporating this "double spend" feature into their wallets. This is known as RBF, "replace by fee" and is really useful when you need to bump your transaction up the queue. You replace your old transaction, that is waiting to be mined, with a new one that offers a higher fee to incentivize miners to add it to a new block.

I think its rather unfortunate that 0 conf transactions were written off so quickly. There are many context where a 0conf tx makes sense, mostly IRL. But, if you are running a business online and you don't trust you customers you should wait 3-6 blocks after the transaction has been mined before delivering your goods.

Re: '50% of transactions were fraudulent' when Steam accepted Bitcoin for payments

#144

Post by TrapLord_Rhodo »

rglullis wrote: post #121
sebzim4500 wrote: post #72

Earlier quoted context omitted.

Not sure about the others but Solana is not centralized.

How much does it cost to run a node? Strictu sensu, it is "decentralized". In practice, it has all the disadvantages of blockchains and none of the advantages of the traditional banking networks.

it's profitable.

Re: '50% of transactions were fraudulent' when Steam accepted Bitcoin for payments

#145

Post by bena »

hashimotonomora wrote: post #98
georgyo wrote: post #23

Earlier quoted context omitted.

Cash is completely fungible because there is no clear trace of money from one person to the next. If someone steals 100k of cash, there is a very low probability that the serial number of those bills were recorded somewhere. And even if they were, you couldn't easily trace the money though complex systems. Bitcoin on the other hand is a complete and open ledger. When these large heists that constantly happen, it is t…

The fact that it’s difficult or expensive to track does not mean it cannot be. Technically it’s possible to force every cash handling business to scan (just like you scan an UPC) each bill.

"This note is legal tender for all debts, public and private."

If I buy you lunch today, you can pay me back next week. We're not "cash handling business[es]", so we wouldn't have to scan.

Second, I don't think it's technically possible. For companies that do business across state lines, sure, but within a state's border, interstate commerce laws don't apply. Each state would have to enact a similar law. And best of luck with that.

Re: '50% of transactions were fraudulent' when Steam accepted Bitcoin for payments

#146

Post by hungryforcodes »

lokar wrote: post #82

There seems to be a basic misunderstanding on the part of the pro-btc ppl here all saying "how is that fraud?" or "how is that steams problem?" If you run a business that can be used in a money laundering scheme, even if you are not a victim, you have a legal responsibility to try to limit/prevent that actually. The crypto crowd may not like that, but it's not up to them.

There is absolutely no definition of fraud that I read in the article.

Re: '50% of transactions were fraudulent' when Steam accepted Bitcoin for payments

#147

Post by jayd16 »

gruez wrote: post #138
jayd16 wrote: post #120

Earlier quoted context omitted.

Conceivably, the public ledger aspect of the technology.

I doubt steam is doing blockchain analysis, tracing back where the coins came from, and seeing whether the exchange that sold them the coins were defrauded or not.

First off, why not? Why would you doubt that when they're a massive storefront and deal with fraud of all kinds?

But also, wouldn't it be fairly easy and beneficial to have this information? Exchanges know what wallets are charged back and fraudulent.

Is it not in their interest to work with Steam?

Or even, is it not in the exchange's interest to do this analysis and demand the coin from Steam?

Re: '50% of transactions were fraudulent' when Steam accepted Bitcoin for payments

#148

Post by gruez »

deutschewelle wrote: post #134
woah wrote: post #28

Completely incoherent article. What does “fraudulent” even mean? Fraudulent credit card transactions for gift cards are common, because the gift card provides a way to cash out a stolen credit card number. But if a criminal has access to someone else’s Bitcoin, it’s already “cashed out”.

I feel like your comment is unjustified and incoherent. It is obvious to many of us what "fraudulent" mean here, it could be an array of: - previously flagged wallets moving through mixers - purchases and refunds to facilitate money laundering - converting to and from steam wallet to crypto etc. It is NOT at all ambiguous which is what you are insinuating as the basis for not reading past the headline and discouragin…

>It is obvious to many of us what "fraudulent" mean here, it could be an array of:

>- previously flagged wallets moving through mixers

So if someone robbed a bank, used that money to buy drugs, that money ended up in my hands somehow (eg. I bought from the same drug dealer), and I used that to buy a big mac, my big mac purchase is "fraudulent" as well?

>- purchases and refunds to facilitate money laundering

How does that even work? You can only refund to the same person. It's not like you can buy a game, gift it to someone, and have that person "refund" the game to cash out

>- converting to and from steam wallet to crypto etc.

There isn't an official way to convert steam wallet to crypto

>It is NOT at all ambiguous which is what you are insinuating as the basis for not reading past the headline and discouraging others from doing so.

1. You say it's "NOT at all ambiguous" but you yourself listed 3 very different possible reasons. That sounds pretty ambiguous to me.

2. I skimmed the article and there isn't really much in the body either.

Re: '50% of transactions were fraudulent' when Steam accepted Bitcoin for payments

#150

Post by ta988 »

duxup wrote: post #4

> There's a difference between what it should be and what it really is currently in the real world. I feel like that when I speak with bitcoin enthusiasts. Lots of ideology that I don’t necessarily disagree with… but the ecosystem is something else…

That's the thing if you talk to people from any political party or ideology, there are some really general ideas that may not be shocking. What matters is the reality of the actions of those people and those they believe in.
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