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68% of total Ethereum transaction value controlled by one system

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Re: 68% of total Ethereum transaction value controlled by one system

#11

Post by mesozoic »

cgb223 wrote: post #9
seibelj wrote: post #4

It's an ETH mixer, it helps you obfuscate ETH, the same exists in BTC and all other crypto currency systems without inherent privacy.

But since its still on a permanent immutable blockchain, couldn't someone still trace Bitcoin/Eth transactions with perfect accuracy?

Sort of. It seems to me though that once you've missed coins from many sources in various ways 90+ times then the coins are distributed in parts to many end recipients its then very hard to to say if some fraction of a coin came had any one source. If I were designing a way to launder cryptocoins that may or may not have a questionable source I think this is pretty much what I'd come up with.

Re: 68% of total Ethereum transaction value controlled by one system

#14

Post by mesozoic »

shemnon42 wrote: post #3

Is the story that 68% of the traffic is naked laundering or that 68% of the traffic is people buying into ICO that are not already enfranchised in ethereum?

Could be laundering but even with that you wouldn't want all of the source currency to be illegitimate so only a fraction of it would be. So it would probably cover both cases.

Re: 68% of total Ethereum transaction value controlled by one system

#15

Post by dahdum »

Aren't these the temporary deposit addresses that exchanges give out? You deposit and then they sweep the balance to their hot/cold wallets as necessary?

Also the ReplaySafeSplit and related contracts were due to the ETH/ETC split, you had to move your coins to be safe.

I see no evidence of a "mixer" being the cause.

Re: 68% of total Ethereum transaction value controlled by one system

#16

Post by aeturnum »

cgb223 wrote: post #9
seibelj wrote: post #4

It's an ETH mixer, it helps you obfuscate ETH, the same exists in BTC and all other crypto currency systems without inherent privacy.

But since its still on a permanent immutable blockchain, couldn't someone still trace Bitcoin/Eth transactions with perfect accuracy?

Yes - mostly. The idea behind a mixer is this:

1. Your transaction goes into their address

2. Their address is always transferring money to accounts.

3. Sometime after you pay them, some amount, not quite the same, leaves their address to an address you control, but which has no established connection to you.

So an observer can see:

1. That you put money into the mixer.

2. The full list of addresses the mixer payed 'out' to (very long).

Which allows them to say if an address has "mixed" money but not to determine which account is connected to which person. If you're careful and you don't transfer any coins to addresses linked to your 'real world' persona, it becomes difficult to trace the account containing the 'mixed' coins to you (though trivial to identify it as coming from the mixer).

Re: 68% of total Ethereum transaction value controlled by one system

#17

Post by Nition »

dahdum wrote: post #15

Aren't these the temporary deposit addresses that exchanges give out? You deposit and then they sweep the balance to their hot/cold wallets as necessary? Also the ReplaySafeSplit and related contracts were due to the ETH/ETC split, you had to move your coins to be safe. I see no evidence of a "mixer" being the cause.

I was wondering that too. I know at least some exchanges (maybe even all the major ones?) use temporary addresses like that. I wonder when they started doing that. There's the huge spike in "mixer" activity from March this year onward, but that's also when Ethereum gained a lot of value. Maybe it's just a lot more trading started happening on the exchanges?

Re: 68% of total Ethereum transaction value controlled by one system

#19

Post by Karunamon »

cgb223 wrote: post #9
seibelj wrote: post #4

It's an ETH mixer, it helps you obfuscate ETH, the same exists in BTC and all other crypto currency systems without inherent privacy.

But since its still on a permanent immutable blockchain, couldn't someone still trace Bitcoin/Eth transactions with perfect accuracy?

Kinda, the problem is once you've moved through a couple wallets (many wallets, in the case of the mixing services), it becomes very hard to tell the difference between one person moving their coins around, and one person paying another person.

    A --> B


    A --> B --> C --> ...--> Z
Pretend you know who A is already. Who are B through X? Is the person in control of A also in control of Z? Or any of the other wallets? These are answers the blockchain doesn't give you.

Re: 68% of total Ethereum transaction value controlled by one system

#20

Post by Slartie »

Animats wrote: post #13

This mixing ramped up around the same time as the price did. Etherium was around $8 at the beginning of 2017, where it had been for years. By midyear it was in the $300-$400 range. Is this mixing somehow involved with a scheme to pump the price?

I would say the relationship is this one:

First, Ethereum was found to be the perfect Ponzi scheme platform by dubious “ICO“ initiators.

Then, early investors made a huge bunch of money on these ICOs.

Then the price skyrocketed, as more people wanted some of that easy ICO money.

This in turn made the mixing services insanely popular, as all of those ICOs had to cash out, and knowing that their business was of dubious nature, many decided to obfuscate the target addresses of their ether via mixers to protect either OTC buyers or their personal accounts on exchanges from being linked with the ICO addresses.

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