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Investors sue Treasury Department for blacklisting crypto platform Tornado Cash

nytimes.com

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Re: Investors sue Treasury Department for blacklisting crypto platform Tornado Cash

#161

Post by FireBeyond »

x86x87 wrote: post #93
speedylight wrote: post #26

Earlier quoted context omitted.

You could also say that Silk Road was an E-commerce business that might’ve been used to sell drugs, who knows!

Not one to defend Silk Road, but pause and think about it for a second: it enabled you to buy something deemed illegal by the authorities (drugs) in a safe manner and the products bought were higher quality than what you could buy on the street. Why was it a problem to begin with and why where significant resources used to shut it down? (Again, not defending it, and the founder was probably a scumbag, I am just askin…

> it enabled you to buy something deemed illegal by the authorities (drugs) in a safe manner and the products bought were higher quality than what you could buy on the street. Why was it a problem to begin with and why where significant resources used to shut it down? (Again, not defending it, and the founder was probably a scumbag, I am just asking the question)

Because there was all sorts of white washing like this. "It's drugs, but safer, and without the violence and crime!"

If you think that violence, crime are magically gone because of Silk Road, you'd be considered ignorant or naive. Production still happens in the same places, the poverty, corruption and violence-stricken areas.

It's just invisible to you now, because you don't have to worry about your dealer stealing from you, getting mugged, or buying from an unknown source, or being arrested.

All those people in Mexican and Colombian villages subject to the tyranny of the cartels... oh well.

All good then, I suppose.

Re: Investors sue Treasury Department for blacklisting crypto platform Tornado Cash

#162

Post by JumpCrisscross »

jnovek wrote: post #86
woodruffw wrote: post #38

Earlier quoted context omitted.

"Might be used for illegal purposes" is a significant understatement. The chief selling point of Tornado Cash is money laundering, which is in and of itself a crime in both the US and Netherlands. Normally, there'd be an aspect of plausible deniability: torrent index operators can, for example, rightfully claim that they're facilitating legal filesharing, or that they're entirely agnostic to the content being shared…

GP isn’t wrong, though. Even if the primary value of Tornado Cash is dubious, I’m still uncomfortable with the contemporary attitude of “block first, ask questions later (maybe)”.

> the contemporary attitude of “block first, ask questions later (maybe)”

The sanctions followed Tornado being fingered as the laundering service used by Norrh Korea [1][2].

[1] https://hub.elliptic.co/analysis/the-100-million-horizon-hac...

[2] https://www.cnbc.com/2022/06/30/north-korea-likely-behind-10....

Re: Investors sue Treasury Department for blacklisting crypto platform Tornado Cash

#163

Post by JustLurking2022 »

danaris wrote: post #135
capableweb wrote: post #124

Earlier quoted context omitted.

You're almost getting it. We still allow hot dog stands to exists, even though you could launder money via them. Instead, we let police investigate cases where money laundering is happening, and if it happens to be via one hot dog stand, take down that specific one. Rather than banning hot dog stands in general. Same goes for Tornado Cash. It was not designed for money laundering, although you could use it for that.…

...Because money laundering is illegal . No one's going to advertise openly to the public "Assassination services here! Just call 1-800-KIL-THEM!" And no one's going to put in public documents "we set up this company in order to facilitate money laundering."

I think danaris's point stands - if you design an iron maiden style murder chamber but simply alter the name to "one time use changing room", you're not fooling anyone, the purpose is still clear, and illegal.

Re: Investors sue Treasury Department for blacklisting crypto platform Tornado Cash

#164

Post by JumpCrisscross »

dannyw wrote: post #113
woodruffw wrote: post #90

Earlier quoted context omitted.

If the Treasury or Dutch authorities are to be believed, the chief purpose of this mixer was to facilitate money laundering. That is key to this entire discussion: they have reason to believe that Pertsev knowingly ran a money laundering service, rather than running a service that criminals can abuse to launder money.

That's interesting. As a Tornado Cash user, I have never associated this with an intentional money laundering service, but rather a bunch of developers advancing zk-SNARKs and other cryptographic primitives. As someone who was excited by the original Bitcoin whitepaper back in 2011, zk-SNARKS was what excited me about cryptocurrency again in 2021.

> have never associated this with an intentional money laundering service

Most customers of a canonical money launderer, a laundromat, don’t realise it’s a front. That doesn’t matter if the owner is laundering money.

Tornado laundered money for North Korea [1]. (It announced this months before the sanctions, a period in which the developers could have reacted but didn’t [EDIT: in any meaningful way].) That it was also obfuscating legitimate flows is frankly irrelevant.

[1] https://www.bloomberg.com/news/articles/2022-08-08/crypto-mi...

Re: Investors sue Treasury Department for blacklisting crypto platform Tornado Cash

#165

Post by vkou »

logicalmonster wrote: post #103
woodruffw wrote: post #38

Earlier quoted context omitted.

"Might be used for illegal purposes" is a significant understatement. The chief selling point of Tornado Cash is money laundering, which is in and of itself a crime in both the US and Netherlands. Normally, there'd be an aspect of plausible deniability: torrent index operators can, for example, rightfully claim that they're facilitating legal filesharing, or that they're entirely agnostic to the content being shared…

> Normally, there'd be an aspect of plausible deniability If it was publicly known that you had exactly 1 ton of legally acquired gold in your house, would you feel perfectly safe sleeping at night? Is there not 1 sicko out there that would be willing to torture your family to find the combination to your vault? Plausible deniability exists here. It's called wanting privacy, and there's perfectly valid and non-crimin…

If I had 45 million dollars in my house, I'd look into whatever the hell individuals of that net worth are doing to protect themselves.

Which, as I understand it, mostly consists of not keeping it as a gold brick in their basement, and not living in a shitty neighbourhood. It's harder to rubber hose attack someone who isn't keeping all their wealth in a crypto wallet.

Re: Investors sue Treasury Department for blacklisting crypto platform Tornado Cash

#166

Post by iotku »

kibwen wrote: post #34
programmarchy wrote: post #27

If Tornado Cash could be banned, couldn't the same logic be used to ban Tor? The former obscures financial transactions, and the latter obscures communications, but there's a similar principle in play.

The US military itself uses Tor. They don't want to ban it, because even if the traffic on Tor is illicit, it still serves to mask the military's own traffic. Don't forget that Tor was originally developed by the US Navy.

>The US military itself uses Tor. They don't want to ban it

That's not really any reassurance in the long term, if they find a better/different solution that goes out the window.

Re: Investors sue Treasury Department for blacklisting crypto platform Tornado Cash

#167

Post by JumpCrisscross »

TEP_Kim_Il_Sung wrote: post #119
duped wrote: post #60

Earlier quoted context omitted.

> The chief selling point of Tornado Cash is that it's distributed open-source software, with no man in the middle, no single point of failure for laundering money. You can't remove the key feature from metaproperties of the software and call the latter the "chief selling point."

So say you, and yet my claim is self-evident, while yours needs hordes of robe&badge clad bureaucrats, and the promise of violence, to enforce.

> yet my claim is self-evident, while yours needs hordes of robe&badge clad bureaucrats

You’re describing due process. That’s a feature. An AK-47 being metallic may be self evident. That doesn’t make it relevant to a murder investigation.

Re: Investors sue Treasury Department for blacklisting crypto platform Tornado Cash

#168

Post by eropple »

logicalmonster wrote: post #103
woodruffw wrote: post #38

Earlier quoted context omitted.

"Might be used for illegal purposes" is a significant understatement. The chief selling point of Tornado Cash is money laundering, which is in and of itself a crime in both the US and Netherlands. Normally, there'd be an aspect of plausible deniability: torrent index operators can, for example, rightfully claim that they're facilitating legal filesharing, or that they're entirely agnostic to the content being shared…

> Normally, there'd be an aspect of plausible deniability If it was publicly known that you had exactly 1 ton of legally acquired gold in your house, would you feel perfectly safe sleeping at night? Is there not 1 sicko out there that would be willing to torture your family to find the combination to your vault? Plausible deniability exists here. It's called wanting privacy, and there's perfectly valid and non-crimin…

> In an of itself, mixing or trading to obfuscate your identity shouldn't be considered a crime or unreasonable in the slightest.

"Financial privacy" isn't a real thing, because you owe taxes on income and investments. Can you explain to me how your tax assessor is able, then, to properly identify your income and tax you on it as appropriate?

(Money laundering and tax evasion do not always go hand-in-hand. Many launderers pay taxes as a cost of doing business. Cryptocurrency mixers seem to treat tax evasion as a feature.)

Re: Investors sue Treasury Department for blacklisting crypto platform Tornado Cash

#169

Post by zeusk »

capableweb wrote: post #130
roleplayer wrote: post #84

Missing from this conversation is the fact that TC was specifically designed to be able to prove your input/output if law enforcement requests it.

I used Tornado Cash (non-US citizen here) for hiding transactions from the public (not hiding from the government), and when I filed my taxes, I still accounted for everything that is stored there + transacted via Tornado Cash, just like I do for my bank account. Appendix contained instructions for how they could access the proof of my transactions and accounts to verify themselves.

> I used Tornado Cash (non-US citizen here) for hiding transactions from the public (not hiding from the government)

And how exactly does your bank account publish your transactions to the public?

Re: Investors sue Treasury Department for blacklisting crypto platform Tornado Cash

#170

Post by sofixa »

logicalmonster wrote: post #103
woodruffw wrote: post #38

Earlier quoted context omitted.

"Might be used for illegal purposes" is a significant understatement. The chief selling point of Tornado Cash is money laundering, which is in and of itself a crime in both the US and Netherlands. Normally, there'd be an aspect of plausible deniability: torrent index operators can, for example, rightfully claim that they're facilitating legal filesharing, or that they're entirely agnostic to the content being shared…

> Normally, there'd be an aspect of plausible deniability If it was publicly known that you had exactly 1 ton of legally acquired gold in your house, would you feel perfectly safe sleeping at night? Is there not 1 sicko out there that would be willing to torture your family to find the combination to your vault? Plausible deniability exists here. It's called wanting privacy, and there's perfectly valid and non-crimin…

Why don't you use the traditional banking system, which doesn't result in publicly listed transactions?

I struggle to find a legitimate use case for hiding transactions from your bank and thus tax authority (assuming a developed country).

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