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How to launder Bitcoins

blog.oleganza.com

41–50 of 85 posts

Re: How to launder Bitcoins

#41

Earlier quoted context omitted.

Government would still have to set up a center of "approving" unknown money coming from other sources into local economy. These centers, as you can expect, will be massively bribed by everyone who needs to launder their tainted coins. Also, governments will be much more limited in power when they can't print their money at will and do any "deficit spending".

unknown money coming from other sources into local economy These centers actually exist even today. I personally know places where you can buy dollars using the local currency for something like a 10% discount on the market rate. They are obviously very shady and aren't used by anyone close to being respectable. If you use them and are big enough to matter, expect to be screwed over by law enforcement pretty much the…

"I believe printing money is actually a good thing. But let's not get into an economics argument here."

This, is where I stopped reading.

Re: How to launder Bitcoins

#42

Earlier quoted context omitted.

Government would still have to set up a center of "approving" unknown money coming from other sources into local economy. These centers, as you can expect, will be massively bribed by everyone who needs to launder their tainted coins. Also, governments will be much more limited in power when they can't print their money at will and do any "deficit spending".

unknown money coming from other sources into local economy These centers actually exist even today. I personally know places where you can buy dollars using the local currency for something like a 10% discount on the market rate. They are obviously very shady and aren't used by anyone close to being respectable. If you use them and are big enough to matter, expect to be screwed over by law enforcement pretty much the…

> I believe printing money is actually a good thing. But let's not get into an economics argument here.

You are confusing ethical argument with an economical one. I was talking economics, not ethics. Governments get a lot of power from ability to print money and censor transactions. Bitcoin removes these sources of power to a high degree regardless of whether it's good or bad. Like, when the internet got huge, moral question of whether people should be exposed to "evil books" or not becomes irrelevant. If one wants to read a book you think is not appropriate, he will do so anyway.

Governments printing ASICs to spam the network... That's the most expensive way to attack Bitcoin. If anyone ever gets to it, it simply means that BTC is already established in many places and widely used and very valuable. Governments would love to extract that BTC for their spendings instead of killing it. Like it happened with gold: in theory, gold is superior to printed fiat currency, but it isn't killed, it's confiscated and used as a hard currency among those who can afford keeping it secure: governments and banks, not you and me.

Re: How to launder Bitcoins

#44

Earlier quoted context omitted.

Is that really true? I believe a global passive adversary can easily use timing attacks to deanonymize tor.

I'm not an expert in Tor. In one of Snowden's documents NSA admitted that Tor is hard to infiltrate even for them. I myself don't want to live in a world where you need to actively hide from huge adversaries. I'd prefer a more careless world with smaller adversaries. Hopefully, widespread adoption of Bitcoin will take a lot of power from governments, so we won't have massive money wasting TLAs that create misery all…

I interpreted the NSA documents to mean that Tor is harder than no-Tor. They already know who you are if you don't use Tor, but if you do, they probably have to do some analysis to figure it out.

Let's work this out though. What do we know about the NSA programs?

1. They collect metadata on packets originating from computers connected to pretty much all the US ISPs and many other countries' ISPs.

2. The list of Tor entry and exit nodes is public and you can bet your ass the NSA knows what this list is at all points in their logging history.

3. Most websites are based in the US, and so it's highly likely that the paths from the Tor exit nodes to these websites have some intermediate point on which traffic is logged by the NSA.

4. The NSA has access to a large training dataset of how traffic entering and leaving the Tor network looks because a whole bunch of federal authorities use Tor.

Given 1-4, I think it's likely trivial for the NSA to train a learning algorithm that will correlate packets leaving a Tor exit node with those entering an entry node.

They probably can't do this all the time because it is more expensive than just a database lookup like in the unencrypted case, but it seems me to that if they had the motivation to get you, it wouldn't be too hard for them.

Re: How to launder Bitcoins

#46

Earlier quoted context omitted.

unknown money coming from other sources into local economy These centers actually exist even today. I personally know places where you can buy dollars using the local currency for something like a 10% discount on the market rate. They are obviously very shady and aren't used by anyone close to being respectable. If you use them and are big enough to matter, expect to be screwed over by law enforcement pretty much the…

> I believe printing money is actually a good thing. But let's not get into an economics argument here. You are confusing ethical argument with an economical one. I was talking economics, not ethics. Governments get a lot of power from ability to print money and censor transactions. Bitcoin removes these sources of power to a high degree regardless of whether it's good or bad. Like, when the internet got huge, moral…

Like, when the internet got huge, moral question of whether people should be exposed to "evil books" or not becomes irrelevant. If one wants to read a book you think is not appropriate, he will do so anyway.

That's certainly an interesting perspective but it makes certain assumptions about what bitcoin will be used for that I'm not sure I agree with.

Governments printing ASICs to spam the network... That's the most expensive way to attack Bitcoin.

Not really, somebody estimated that getting ASICs to control 51% of the network would cost only a few hundred million dollars, which isn't much at all from a governmental point of view.

Also, as far semiconductor manufacturing goes - pretty much all of it is the non-recurring engineering cost of designing the IC. The actual cost of printing it on Si is a very small fraction for large volume chips.

Governments would love to extract that BTC for their spendings instead of killing it.

Governments than can print fiat currency don't really have a problem financing their spending. They do have a problem with currencies that undermine fiat currencies.

Re: How to launder Bitcoins

#48
Bitcoin wiki tells you exactly what you need to do.

Generate addresses offline or proxied through Tor or JonDonym. Use different addresses for every input. Use CoinControl program to send coins https://bitcointalk.org/index.php?topic=144331.0

Never post your bitcoin address anywhere you can be identified, such as a msg forum signature, or directly to an exchange for withdrawal/deposit. Use addresses not linked to you (OPSEC).

Stay away from the exchanges that want piles of ID and use P2P trading on IRC or in person.

Re: How to launder Bitcoins

#49

Bitcoin wiki tells you exactly what you need to do. Generate addresses offline or proxied through Tor or JonDonym. Use different addresses for every input. Use CoinControl program to send coins https://bitcointalk.org/index.php?topic=144331.0 Never post your bitcoin address anywhere you can be identified, such as a msg forum signature, or directly to an exchange for withdrawal/deposit. Use addresses not linked to you…

Managing addresses seems like the easy part, to me. The real challenge is getting money in & out of BTC, at least until you can spend it just about anywhere.

Re: How to launder Bitcoins

#50

The issue with money laundering in the real world isn't the technical difficulty. It's easy as pie to launder cash if you ignore the laws surrounding it. I'd imagine that if Bitcon becomes prevalent, governments would ask you to "voluntarily" declare your "salary" wallet. And then if they spotted any sort of suspicious laundering-like activity happening from that wallet, they would very quickly obtain warrants and sh…

How would that help? You declare your "salary" wallet, your salary flows from your day job. You run your underworld schemes in another wallet, and ne'r the two do meet.
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