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How to launder Bitcoins

blog.oleganza.com

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Re: How to launder Bitcoins

#11

Post by [deleted] »

oleganza wrote: post #6
a3_nm wrote: post #4

There are other approaches for laundering which do not rely on insurance contracts, such as http://zerocoin.org/

Zerocoin is interesting, but Bitcoin in its current form has two practical advantages: 1. Cryptographic primitives used in Bitcoin are old and well-tested. There's no crypto code in Bitcoin that was invented by Satoshi and could have been badly broken in a subtle manner. Zerocoin's commitment scheme requires years of testing, attempts to crack it and fixing may be impossible. If the problem is discovered, the whole t…

[deleted]

Re: How to launder Bitcoins

#13

Post by nwh »

oleganza wrote: post #8
nwh wrote: post #5

Earlier quoted context omitted.

If you're doing it persistently you just end up flooding the blockchain with useless information. At least with CoinJoin you're reducing the number of payment TXs that need to be stored and validated. The blockchain is already getting annoyingly large (20GB+ with indexes) without adding fluff like that. If you really want to hide your tracks without hiding your tracks, just use any service with a shared wallet.

You pay for transactions. Don't tell people what to do with their money. Most of the transactions wouldn't be mixed at all. Just using new addresses with small balances is good enough for daily purchases. Mixing is needed only in certain cases like before and after big consolidating transactions. CoinJoin is nice too, but it does not look well in the eyes of "anti-structuring" laws. Shared wallet is an FBI honeypot u…

A shared wallet, not the "shared wallet" service. Many services use them internally, they're in no way a trap.

> CoinJoin is nice too, but it does not look well in the eyes of "anti-structuring" laws.

Neither is a system that flings around your wallet contents all the time.

Re: How to launder Bitcoins

#14

Post by shadowOfShadow »

cheesylard wrote: post #12

I'm starting to get sick of these Bitcoin posts.

Starting, eh? The author basically says the bitcoin handler at the coffee shop will know how much you have unless you go through a massive scheme (which is probably borderline illegal for decent reasons) to gain back any sense of normalcy.

This is what happens when people take their own ball to go play in their own yard.

If it's going to take the amount of time, energy, and expertise to barely make bitcoin usable, how does the cognitive dissonance not overwhelm the coinbugs?

Re: How to launder Bitcoins

#15

Post by nwh »

shadowOfShadow wrote: post #14
cheesylard wrote: post #12

I'm starting to get sick of these Bitcoin posts.

Starting, eh? The author basically says the bitcoin handler at the coffee shop will know how much you have unless you go through a massive scheme (which is probably borderline illegal for decent reasons) to gain back any sense of normalcy. This is what happens when people take their own ball to go play in their own yard. If it's going to take the amount of time, energy, and expertise to barely make bitcoin usable, ho…

That's generally not the case. You might be able to see some of my funds, but certainly not the entire contents of my wallet unless you're using very broken ones. I've hundreds of different inputs in my wallet, and you'd only be seeing one of them.

Re: How to launder Bitcoins

#16

Post by oleganza »

nwh wrote: post #13
oleganza wrote: post #8

Earlier quoted context omitted.

You pay for transactions. Don't tell people what to do with their money. Most of the transactions wouldn't be mixed at all. Just using new addresses with small balances is good enough for daily purchases. Mixing is needed only in certain cases like before and after big consolidating transactions. CoinJoin is nice too, but it does not look well in the eyes of "anti-structuring" laws. Shared wallet is an FBI honeypot u…

A shared wallet, not the "shared wallet" service. Many services use them internally, they're in no way a trap. > CoinJoin is nice too, but it does not look well in the eyes of "anti-structuring" laws. Neither is a system that flings around your wallet contents all the time.

Any service can share its operations with an adversary. That's a risk. If you don't understand that, then you should prefer Digicash to Bitcoin as it's more anonymous, confirms transactions instantly and does not need any stupid mining.

System that flings around my wallet contents does not leave a trace of that activity on the blockchain. Meaning of every transaction is known only to transacting parties, but not to anyone else. That's the big difference from any shared wallet, where operator sees the meaning of all transactions going through it.

Re: How to launder Bitcoins

#18

Post by oleganza »

shadowOfShadow wrote: post #14
cheesylard wrote: post #12

I'm starting to get sick of these Bitcoin posts.

Starting, eh? The author basically says the bitcoin handler at the coffee shop will know how much you have unless you go through a massive scheme (which is probably borderline illegal for decent reasons) to gain back any sense of normalcy. This is what happens when people take their own ball to go play in their own yard. If it's going to take the amount of time, energy, and expertise to barely make bitcoin usable, ho…

Bitcoin is not so bad at privacy as you say. But it's certainly can be made better with fully automated solution deployed on massive scale individually, without major agreement or protocol changes. It's just an evolution of the technology. Ajax apps also did not appear overnight on the web.

Re: How to launder Bitcoins

#20

Post by epscylonb »

nwh wrote: post #15
shadowOfShadow wrote: post #14

Earlier quoted context omitted.

Starting, eh? The author basically says the bitcoin handler at the coffee shop will know how much you have unless you go through a massive scheme (which is probably borderline illegal for decent reasons) to gain back any sense of normalcy. This is what happens when people take their own ball to go play in their own yard. If it's going to take the amount of time, energy, and expertise to barely make bitcoin usable, ho…

That's generally not the case. You might be able to see some of my funds, but certainly not the entire contents of my wallet unless you're using very broken ones. I've hundreds of different inputs in my wallet, and you'd only be seeing one of them.

I think the danger of the public nature of the blockchain is way overstated. It's fairly trivial to introduce reasonable doubt into your transaction history, blockchain analysis is nowhere near as useful to law enforcement as some people think.

The situation I worry about more is when someone is operating outside of the law, for example if you legitimately but unknowingly end up with some coins that were previously stolen, and then some guys with baseball bats turn up at your house.

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