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Feds arrest couple, seize $3.6B in hacked Bitcoin funds

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Re: Feds arrest couple, seize $3.6B in hacked Bitcoin funds

#381

Post by boc »

wcoenen wrote: post #153
AlexanderTheGr8 wrote: post #117

Earlier quoted context omitted.

I agree. But if not for privacy, why use crypto at all? Even bank accounts are reasonably private, if you are not doing anything considered suspicious by society. Also, with mixers such as tornado_cash, laundering money is , sadly , pretty trivial.

Mixing is not laundering. The difference is that laundering provides you with an explanation for wealth and/or income. Example of laundering: buy a business (with clean or borrowed money), have fictional customers "spend" their cash money at your business every day, then report your income and pay taxes. Now if anybody asks about where you got your money, you have a seemingly legit explanation. Mixing does none of th…

I love how you're just realizing that NFTs are a pure money-laundering scheme. Just wash trade your bored ape and "sell" it to your alter ego and bam! Legitimate income for the cost of some ETH gas.

Re: Feds arrest couple, seize $3.6B in hacked Bitcoin funds

#383

Post by vmception »

madars wrote: post #341
vmception wrote: post #141

Earlier quoted context omitted.

Ironfish is just a testnet so there is zero liquidity there because it isn't even launched. Tornado cash has about $700mm right now deposited in it, with the vast majority of that being in the 100 ETH deposit pool. They absolutely could have done it over time. They could have bridged the Bitcoin using the RenVM protocol to receive renBTC, done a combination of selling the renBTC and let arbitrageurs provide the liqui…

What about network level privacy? i.e. they'd also want to minimize the linkage between broadcast patterns and characteristics of those 100k addresses

Run their own nodes on the respective cryptocurrency networks they use.

Re: Feds arrest couple, seize $3.6B in hacked Bitcoin funds

#384

Post by lern_too_spel »

bastawhiz wrote: post #188
lern_too_spel wrote: post #150

Earlier quoted context omitted.

It will probably be returned to Bitfinex if they can access the wallet.

That's assuming the feds don't have unfinished business with Bitfinex. They're not exactly on great terms.

That's just nitpicking. If Bitfinex is acting as a custodian, the property will be returned to the owners. Whether that return happens via Bitfinex or via the feds looking at Bitfinex's books doesn't really change much. The point is that the feds can't destroy property just because they don't like who it was stolen from.

Re: Feds arrest couple, seize $3.6B in hacked Bitcoin funds

#385

Post by [deleted] »

duxup wrote: post #74
caseysoftware wrote: post #65

I'm sitting here trying to understand their mindset. They had to know what kind of scrutiny would be on those coins forever. At the time of the theft, the coins are worth $100M+ and they can't touch them. Even worse, anything they do with them will be monitored, researched, dug into, and everything else from law enforcement, amateur detectives, and every major tech+crime group. Fast forward to now and the coins are w…

I was wondering about this. I would think the most obvious path would be to find some other criminals (now you've got new risks) who don't care about the provenance of the coins, will pay cash for some coins at a discount, and you somehow launder that cash.... Could at least get a couple bucks from it, possibly.

[deleted]

Re: Feds arrest couple, seize $3.6B in hacked Bitcoin funds

#386

Post by 323 »

caseysoftware wrote: post #151
duxup wrote: post #74

Earlier quoted context omitted.

I was wondering about this. I would think the most obvious path would be to find some other criminals (now you've got new risks) who don't care about the provenance of the coins, will pay cash for some coins at a discount, and you somehow launder that cash.... Could at least get a couple bucks from it, possibly.

Or weaponize the coins. Take 10 BTC and give them to 100 groups/people you don't like. Investigators make their lives miserable for a while. For normal people, that'd be ridiculously expensive but since they didn't pay for the coins and have 100k+ more they can't use, it's "free."

That wouldn't work, the same way it wouldn't work to park a stolen Ferrari or a bag of cash in front of your house to accuse you of something. The situation would be cleared up pretty quickly.

Re: Feds arrest couple, seize $3.6B in hacked Bitcoin funds

#387

Post by thebean11 »

aeturnum wrote: post #379
bostonsre wrote: post #286

Earlier quoted context omitted.

I don't understand why he wouldn't move to somewhere that doesn't have an extradition policy with the US. If you go down that path, it seems like you should probably be willing to abandon your life. It's the same with Ross Ulbricht, seems like it would be terrifying living with that sword of damocles hanging over your head absolutely constantly.

The work of preparing to leave the country is necessarily public in a way that doing crypto stuff might not be. I suspect they were worried that preparing to leave the country would tip their hand - and they could have been caught earlier if they tried it. It just turns out they were caught anyway.

Hmm what work is that? Getting a visa? With that much cash I'd leave first (on a tourist visa) and figure the rest out later..

Re: Feds arrest couple, seize $3.6B in hacked Bitcoin funds

#388

Post by CrazyStat »

trhway wrote: post #323
zozbot234 wrote: post #199

Earlier quoted context omitted.

He was just a million-dollar hacker, but the power of HODL boosted his illicit fortune to the billion-dollar range.

reading a bit about him and the hack (which at some point was for example blamed on those Israeli brothers with connections to IDF hacking unit) i kind of not sure that he is the hacker ( and note that he is charged with laundering not hacking) - he in my view better fits the profile of the "investor"/"fencer" whose involvement would be to launder. Sidenote: one of the reasons i don't touch crypto is possible launder…

> Sidenote: one of the reasons i don't touch crypto is possible laundering charge/suspicion if the tokens happens to had passed through unsavory hands/situation

A page recently posted here ([1], citing [2]) claimed that there's a market for freshly mined Bitcoin (i.e. with no history), with people paying as much as 20% markup for it to avoid such risks.

I didn't make any attempt to verify this claim.

[1] https://sethforprivacy.com/posts/fungibility-graveyard/

[2] https://news.bitcoin.com/industry-execs-freshly-minted-virgi...

Re: Feds arrest couple, seize $3.6B in hacked Bitcoin funds

#389

Post by [deleted] »

whatshisface wrote: post #337
AlexanderTheGr8 wrote: post #163

Earlier quoted context omitted.

tornado.cash puts your crypto in a completely fresh account (using smart contracts). You can claim that you earned this crypto mining it back in 2010. You can definitely come up with a decent excuse for this. Then you can convert those crypto (in new account) into fiat money. Everyone will know you are lying, but they will never be able to prove it.

That sounds impossible, wouldn't people be able to see that the account didn't have those coins in 2010?

[deleted]

Re: Feds arrest couple, seize $3.6B in hacked Bitcoin funds

#390

Post by knownjorbist »

pcthrowaway wrote: post #256
knownjorbist wrote: post #93

Earlier quoted context omitted.

A DAO could just as easily decide to do the same, but it'd need to be built into the smart contracts.

This works with the smart contracts with USDC, it's just that there's an authority which has permission to update the state to deny transfers from a specific address. This is because USDC is a centralized stablecoin (as is USDT). There are decentralized stablecoins such as UST and MIM (and I believe DAI as well).

Correct, though on second thought, given how slow many DAOs are to operate, the perpetrators would already be in some other uncontrollable currency by the time people voted to blacklist certain wallets.
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