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Investors sue Treasury Department for blacklisting crypto platform Tornado Cash

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

#511

Post by waste_monk »

everfree wrote: post #326
qeternity wrote: post #269

Earlier quoted context omitted.

The onus is for technology to comply with laws, not the other way around.

Laws bind people, and people should comply with laws. Technology is not a person. People who make technology should not be expected to add measures to it to make sure that nobody is ever able to use it to commit a crime. This kind of thinking would have resulted in guns being banned until technology exists for the gun itself to detect who was firing it and what it was being fired at, to prevent any crimes from occurr…

>People who make technology should not be expected to add measures to it to make sure that nobody is ever able to use it to commit a crime

Why not? It's quite common, e.g. a lot of photocopiers have safeguards to prevent currency counterfeiting and will refuse to copy bank notes containing the EURion constellation and other common bank note markers. Pretty much any decent financial software will have sane defaults for audit trails, separation of duties, and so on to try and prevent fraud. Etc.

If you deliberately build something that can facilitate money laundering and ignore finance laws about KYC and mandatory reporting and and so on, you only have yourself to blame if you run into legal trouble. It doesn't matter if you don't like the law or think it shouldn't apply.

>This kind of thinking would have resulted in guns being banned until technology exists for the gun itself to detect who was firing it and what it was being fired at, to prevent any crimes from occurring

You'd have to ban all blades, any kind of explosives (mining), any kind of vehicle, etc. ... a creative person can misuse just about any technology to commit a crime. At some point it is simply not possible to build safeguards. How would you put access controls on a sharp rock?

I don't want to open the whole gun control can of worms, but down here in Australia we have strict firearm control and our firearm-related death rate is very low (0.92/100k population, vs. 10.95/100k for the USA [1]). It still happens of course, but the rate is low enough that strict technological controls wouldn't add much value. And I believe, though can't find the source I remember seeing a while ago, that a pretty big chunk of those are suicides / accidents and there is very low violent crime.

[1] https://worldpopulationreview.com/country-rankings/gun-death...

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

#512

Post by ls15 »

logicalmonster wrote: post #393
wizofaus wrote: post #378

Earlier quoted context omitted.

I assume you mean the overturning of and the lengths to which certain states appear to be going in order to determine whether women have attempted to have now-illegal abortions? I'd agree that's a pretty reasonable example of why we still need the ability to pay for things in an untraceable manner and why to object to any attempt to phase out cash as a legitimate method of payment. But I'd also much rather have const…

> But I'd also much rather have constitutional protections that don't allow governments to declare consensual surgical procedures on your own body to be illegal. Interesting concept, but a few quick thoughts on this. 1) I'd only point out that there exists a point of view that that says that a baby's body is a separate life from a woman's body. 2) Such a constitutional protection would open up some very complicated i…

> 1) I'd only point out that there exists a point of view that that says that a baby's body is a separate life from a woman's body.

By that point of view it would be reasonable to separate both bodies if one of them wishes to be left alone, so both can move on with their lifes. Equal rights.

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

#513

Post by [deleted] »

notch656a wrote: post #366
polygamous_bat wrote: post #348

Earlier quoted context omitted.

Tornado cash would not be sanctioned if it were not public and therefore not used by North Korea, yes. What is your point here?

Then using your analogy it should not be sanctioned. There is nothing illegal about a North Korean coming to your property and driving a car without a license. Your logic that _because North Korean, therefore public property_ is nonsensical. And as an aside: >Driving a car requires a license and registration of the vehicle. Patently false.

[deleted]

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

#514

Post by Ferret7446 »

polygamous_bat wrote: post #159
sam0x17 wrote: post #16

Earlier quoted context omitted.

Your argument is akin to saying people shouldn't be allowed to drive cars because a car was used one time in a heist.

Driving a car requires a license and registration of the vehicle. You can go to jail for driving a car without a registration or license. In very much the same way, if you are running a money transmitting business, you need to register with the government and follow the government laws. Otherwise, you risk going to jail. It's not rocket science. Just because it is on the internet doesn't make it a whole new thing.

No one is running Tornado Cash. Tornado Cash is a smart contract running on the Ethereum blockchain. At one point someone uploaded the contract, but that person can no longer modify the contract and they are not running the contract. You can arrest that person and shut down all of their servers and the contract will continue to run.

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

#515

Post by Ferret7446 »

vorpalhex wrote: post #503
dcolkitt wrote: post #498

Earlier quoted context omitted.

Contract devs don't execute the code. They simply broadcast the it to the Ethereum network. Deploying a contract is conceptually no different than publishing source code to GitHub. It's actually the Ethereum node operators that execute the code. (Hence why the contract devs can't stop a running smart contract.) If you want to make the argument that the persons executing the code are liable, than it should be the Ethe…

Given that the treasury department has frozen Tornado, and generally made the whole project persona non grata, I believe your theory here is fairly thoroughly debunked. Trying to find a loophole in the law by trickery is why we use human courts - the judge can still find you guilty and punish the living crap out of you for abetting money laundering.

> Given that the treasury department has frozen Tornado

They haven't though. Tornado Cash is still happily running. If you post your address here, some kind soul might even send you some ETH via Tornado Cash right now. They have asked regulated financial institutions to not receive ETH that came directly from Tornado Cash. That's it; that's all that they can do. While that puts a damper on people converting directly between ETH and USD at such institutions, it does bugger all for people conducting small/informal transactions

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

#516

Post by qeternity »

Infinitesimus wrote: post #331
qeternity wrote: post #283

Earlier quoted context omitted.

No, it’s like saying E2EE encryption is designed to secure private communications between two parties, which is what it’s designed to do. Mixers are designed to facilitate money laundering. You can claim it’s for legitimate privacy, etc but it doesn’t change the fact that it’s money laundering.

I have no horse in this race and pardon my nitpicking but those two phrases are not equivalent. For E2EE,you describe the base level capability: Secure message between two parties. For Mixers, you describe an act that the capability of making money hard to trace enables: Money laundering. If you applied a similar argument to E2EE (as many have and will keep doing), encrypted communications are a way for people to do…

TC was designed to obscure the source of funds. Obscuring the source of funds is money laundering.

You're drawing a distinction between illicit and privacy-seeking transaction and I'm saying the act of obscuring the source is all that matters.

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

#517

Post by rev_d »

hakfoo wrote: post #508
jdmichal wrote: post #433

Earlier quoted context omitted.

Your real estate example is not a great fit, because real estate transfers are not common. That particular tax-free status on the transfers would probably be best interpreted as a carve out or loophole, with the normal status being that the transactions should be taxed. On the other hand, depositing money is the normal status. Depositing what amounts to large sums over arbitrary periods of time is also normal. Direct…

Is mandatory reporting a good idea, though? I feel like the signal-to-noise ratio must be terrible, especially as inflation gradually lowers the meaning of a $10,000 reporting limit. Selling a used car is enough to trigger a reportable amount of cash. I'd think what we need is less magic numbers, and instead a better training/reporting ecosystem that insulates people with good intentions but gives them the right tool…

The government is well-aware of how inflation erodes reporting thresholds. If you look at the obligation to report non-US bank accounts to FinCEN, they've indexed the penalties ($10,000 per line item) to inflation but not the $10,000 aggregate reporting threshold.

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

#518

Post by devoutsalsa »

pyuser583 wrote: post #507
eropple wrote: post #382

Earlier quoted context omitted.

Yeah, that's the price of retaining your American citizenship, which is among the most valuable in the world to have if you ever have a "I need to call my consulate" problem. But you don't have to retain your American citizenship--there are a lot of countries out there! Granted, that's assuming you're a valuable enough contributor to society that you'll find another country interested in taking you, one that won't si…

It’s really hard to get rid of American citizenship.

It's not that tough. You just need another citizenship, $2_350 to pay the renouncement fee, and an appointment at a USA consulate/embassy to formally renounce. You also need to pay an exit tax if you have a net worth of $2 million+.

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

#519

Post by chollida1 »

rglullis wrote: post #394
chollida1 wrote: post #294

Earlier quoted context omitted.

https://medium.com/@blockchain101/the-basics-of-upgradable-p... You put in a proxy contract that just sends the money back to the user who sent it to you. Problem solved for sanctions.

To put a proxy contract means that there will be an admin able to make contract upgrades. IOW, you need to have offchain trust in the contract deployer. This is widely regarded as a measure that defeats the purpose of decentralization. So, yes, you could have an upgraded version of TC, but if you want to go that route you might simply use a centralized exchange as a mixer.

Sure, you are partially correct in your understanding.

I was only responding to some one who doesn't understand the ETH tech stack who said it was impossible. It most certainly isn't impossible and proxy contracts are how we deal with things like this in ETH.

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

#520

Post by [deleted] »

hakfoo wrote: post #508
jdmichal wrote: post #433

Earlier quoted context omitted.

Your real estate example is not a great fit, because real estate transfers are not common. That particular tax-free status on the transfers would probably be best interpreted as a carve out or loophole, with the normal status being that the transactions should be taxed. On the other hand, depositing money is the normal status. Depositing what amounts to large sums over arbitrary periods of time is also normal. Direct…

Is mandatory reporting a good idea, though? I feel like the signal-to-noise ratio must be terrible, especially as inflation gradually lowers the meaning of a $10,000 reporting limit. Selling a used car is enough to trigger a reportable amount of cash. I'd think what we need is less magic numbers, and instead a better training/reporting ecosystem that insulates people with good intentions but gives them the right tool…

[deleted]
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