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Investors sue Treasury Department for blacklisting crypto platform Tornado Cash

nytimes.com

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

#521

Post by 300bps »

downandout wrote: post #403
woodruffw wrote: post #401

Earlier quoted context omitted.

(B)(ii) does not require specific intent. It requires knowledge that the transaction fails to meet reporting requirements. The intent in question is manifested in Tornado Cash's design, which doesn't pass the malfeasance smell test: you can't absolve yourself of illegality by automating the illegality.

The intent in question is manifested in Tornado Cash's design, which doesn't pass the malfeasance smell test: you can't absolve yourself of illegality by automating the illegality. Given that it also has legitimate uses, I think that's a very difficult case to make. Also, with very limited exceptions, nearly all crimes in the US require intent and/or knowing participation. It's a fundamental tenet of our system. Ther…

Also, with very limited exceptions, nearly all crimes in the US require intent and/or knowing participation.

The fact that this statement is 100% completely wrong in totality is common knowledge.

I recently bought a kayak. In my state I'm required to register the kayak and have a registration sticker on it. If I was unaware of this, there is no, "Oopsie! Didn't know" defense.

This principle goes back to Roman law - ignorantia juris non excusat. You may have heard Thomas Jefferson saying the English version, "Ignorance of the law is no excuse". It's one of the favorite things for judges to say as they sentence people in criminal proceedings.

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

#522

Post by niij »

chrischattin wrote: post #276
sofixa wrote: post #170

Earlier quoted context omitted.

Why don't you use the traditional banking system, which doesn't result in publicly listed transactions? I struggle to find a legitimate use case for hiding transactions from your bank and thus tax authority (assuming a developed country).

Have you ever tried to make a wire transfer on a weekend? Having access to your money outside of banking hours is just one of many use cases I can think of off the top of my head.

This should be resolved next year with FedNow: https://www.frbservices.org/financial-services/fednow/about....

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

#523

Post by vlovich123 »

300bps wrote: post #521
downandout wrote: post #403

Earlier quoted context omitted.

The intent in question is manifested in Tornado Cash's design, which doesn't pass the malfeasance smell test: you can't absolve yourself of illegality by automating the illegality. Given that it also has legitimate uses, I think that's a very difficult case to make. Also, with very limited exceptions, nearly all crimes in the US require intent and/or knowing participation. It's a fundamental tenet of our system. Ther…

Also, with very limited exceptions, nearly all crimes in the US require intent and/or knowing participation. The fact that this statement is 100% completely wrong in totality is common knowledge. I recently bought a kayak. In my state I'm required to register the kayak and have a registration sticker on it. If I was unaware of this, there is no, "Oopsie! Didn't know" defense. This principle goes back to Roman law - i…

Is it “100% wrong in totality”? Mens rea (“guilty mind”) is a required element of many crimes [1]. Moreover, there’s the whole annoying concept of due process [2]:

> as due process required that the defendant have notice of the crime at issue. The Lambert decision explicitly recognized this fair notice requirement as an exception to the general rule that ignorance of the law is no defense.

I’m not saying that necessarily applies here but clearly ignorance of the law can sometimes be an excuse, no?

[1] https://en.m.wikipedia.org/wiki/Mens_rea

[2] https://nccriminallaw.sog.unc.edu/ignorance-law-excuse/

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

#524

Post by vlovich123 »

rev_d wrote: post #517
hakfoo wrote: post #508

Earlier quoted context omitted.

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.

So boiling the frog so that eventually all transactions must be reported?

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

#525

Post by jimmydorry »

300bps wrote: post #496
dmatech wrote: post #490

Earlier quoted context omitted.

I must say that I dislike the rationale for banning structuring. It's basically a law that bans attempts to comply with the letter of another law without complying with its spirit. Complying with any law should be completely straightforward.

I must say that I dislike the rationale for banning structuring. So there are two possibilities. 1. You think the government shouldn't be allowed to track money laundering 2. You have a suggestion on improving money laundering tracking without anti-structuring laws If you believe the government has a legitimate vested interest in stopping money laundering and you set a $10,000 limit before something must be reported,…

The answer isn't to then set the $10,000 limit and add an opaque criteria of "but the limit doesn't matter if we look at your transactions and think you are hiding something".

Something more reasonable may be: a limit of $10,000 per month (or any time frame) before mandatory reporting. That of course means dropping the hand wavy exception completely.

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

#526

Post by vlovich123 »

300bps wrote: post #435
downandout wrote: post #410

Earlier quoted context omitted.

They aren't the hotbed of money laundering you seem to think they are. I spent a fair amount of time in the gaming business, and I can tell you that this statement is patently false. Very little of it gets caught, because the people involved in such schemes know what the rules are and simply work around them. Casinos themselves also sometimes turn a blind eye to such activity when it is especially profitable for them…

There really seems to be a lot of mental gymnastics going on here. Your original point was that casinos are allowed to operate because of their "lack of intent". I respond that it's actually because they're as heavily regulated as banks are. Your response is, "But sometimes they break the law!" Who cares? Casinos are heavily regulated and most of the time they follow their regulations. Or they would be shut down. And…

Out of curiosity, what was the total volume of funds processed over the same time period? I haven’t been able to find that anywhere.

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

#527

Post by vlovich123 »

Daishiman wrote: post #467
bombcar wrote: post #365

Earlier quoted context omitted.

At some point the law can say "you must do this" and ethereum can either go underground or comply. The countries can higher blockchain experts as well as anyone else can, and word the laws as needed.

It is ridiculous how most crypto people fail to understand that the government can compel you to do a bunch of things and if the blockchain doesn't allow they don't just shrug their shoulders and move on with their lives.

How come Apple isn’t compelled to develop an OS that bypasses their own encryption or put in back doors?

I’m not asking a rhetorical question. I’m genuinely confused as to the underlying legal principle about what’s being enforced here?

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

#528

Post by dcolkitt »

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.

There hasn't been a court case yet. Not even a judicial hearing. The article we're commenting on is about how there's a very good chance that courts will disagree. This SCOTUS has repeatedly shown a willingness to restrict executive overreach in the Biden administration.

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

#529

Post by ok123456 »

woodruffw wrote: post #464
ok123456 wrote: post #446

Earlier quoted context omitted.

> The chief selling point of Tornado Cash is money laundering The same thing could be said about paper money.

No, it can't. The chief selling point of fiat is being an efficient medium of exchange. This is a very nice property to have!

Yes it can. The vast majority of crime is done with paper money.

This is also why cops willy-nilly decide to seize it if you have too much of it. There are countless examples of normal people who happened to have large sums of paper money, on their way to buy a vehicle, being stopped and their life savings being taken away through civil asset forfeiture.

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

#530

Post by colinmhayes »

HereIGoAgain wrote: post #472

More power to them. The idea that you shouldn't be able to use something because it CAN be used for crimes is repugnant and dangerous to a free and open democratic society. Plus this is all pretty much settled law is it not?

Tornado was used to launder something like a billion dollars by the north koreans. This is not a CAN be used for crimes situation. It was used to facilitate crimes.
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