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EFF to FinCEN: Stop Pushing for More Financial Surveillance

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Re: EFF to FinCEN: Stop Pushing for More Financial Surveillance

#81

Post by intotheabyss »

refurb wrote: post #72
thefounder wrote: post #25

Earlier quoted context omitted.

The issue is converting that crypto into cash.

This is what I don’t get. Great, you can transfer Bitcoin to anyone for cheap, anywhere in the world. But that Bitcoin is useless to you or whoever you give it to unless it’s converted to currency. That’s where the gov’t puts it’s grip. Move as much Bitcoin wherever you want. Who cares. Want to convert to dollars or Euros or Yen? That’s where the gov’t steps in and say fine - prove who you are for this transaction. W…

Just wrap your Bitcoin into renBTC on Ethereum, and exchange it for DAI stablecoin. Then, deposit it into a zero knowledge mixer contract called tornado.cash and withdraw to a fresh address. Now you've broken the link. An entirely decentralized process of converting BTC into a stablecoin without an intermediary while maintaining some privacy.

Re: EFF to FinCEN: Stop Pushing for More Financial Surveillance

#82

Post by SCHiM »

codethief wrote: post #73
ve55 wrote: post #2

The way I usually phrase this situation is something like "The goals of a strong government are in direct opposition to the goals of most modern cryptocurrencies", and this is yet another subset of those goals where we can see the forces fighting against each other. I find it hard to convince myself cryptocurrency can win out in the long-term, as the more rules they find ways to skirt around via technology and decent…

> You can spend a decade developing a provably-anonymous cryptocurrency (which we have indeed now done) Looks like I've been out of the loop. Which cryptocurrency are you referring to?

I think the op referring to monero (XMR).

Re: EFF to FinCEN: Stop Pushing for More Financial Surveillance

#83

Post by intotheabyss »

KLexpat wrote: post #39
ajkdhcb2 wrote: post #8

Earlier quoted context omitted.

Throughout all of human history people used private forms of money like cash. Why is it that suddenly only now it is a disaster to have financial privacy because of "crime"?

The idea of fiat currency only works when people are forced to participate in it. The petro-dollar was fairly obvious in the late 20th century, but now things are more subtle. The key thing is ensuring that all exchanges of wealth only occur within a currency controlled by the authorities. They are not really concerned about minor instances of tax avoidance; the primary concern is that large scale economic activity c…

What you're describing isn't Bitcoin, but Ethereum, and you can already do a lot of this on Ethereum with stablecoins/ether.

Re: EFF to FinCEN: Stop Pushing for More Financial Surveillance

#84

Post by x87678r »

dogwater wrote: post #6
TheChaplain wrote: post #3

I believe privacy advocates needs to be more involved in the financial sector for there to be any meaningful change and provide counter proposals to balance. The problem now is that a lot of cryptocurrencies are prime targets for money laundering, financing organized crime and terrorism networks. I often get shat on when mentioning that, especially by loud proponents of cryptocurrencies, but it is a real issue that m…

What exactly is this scary crime that is supposively happening with money? They didn't need much money to do 9/11 besides some airline tickets and box cutters, I'm sure it wouldn't trip any bank report flag that would have allowed them to stop it from happening. Organized crime, is that even a thing? If no one is even going after obvious ico scams that have defrauded investors out of hundreds of millions of dollars a…

Terrorist acts are only part of it though. Sure 9/11 was cheap but implementing punitive sanctions across countries hundreds officials requires an awful lot of tracking and monitoring.

As regulators catch up you can expect same forms and reporting for any crypto account as a regular account. If you ignore the rules expect big penalties until you comply- just like how banks have been paying billions in fines and are now tarpits of paperwork.

Re: EFF to FinCEN: Stop Pushing for More Financial Surveillance

#86

Post by Red_Leaves_Flyy »

dannyw wrote: post #80
volta87 wrote: post #32

Earlier quoted context omitted.

The problem isn't tax evasion per-se, but rather logic inconsistencies. For example, I've met quite a bit of people that don't want to pay any taxes. Yet they all want for them and their goods to be able to use roads for free, roads that are built and maintained with taxes. That's actually ok: two incompatible goals just means you have to make a trade-off; welcome to engineering. The problem is that none of them unde…

Most of your taxes don’t go to things like roads or education. They go towards bombing brown people in the Middle East, and a smaller portion goes to programs like Medicare.

https://www.nationalpriorities.org/budget-basics/federal-bud...

Re: EFF to FinCEN: Stop Pushing for More Financial Surveillance

#87

Post by KLexpat »

avianlyric wrote: post #61
KLexpat wrote: post #39

Earlier quoted context omitted.

The idea of fiat currency only works when people are forced to participate in it. The petro-dollar was fairly obvious in the late 20th century, but now things are more subtle. The key thing is ensuring that all exchanges of wealth only occur within a currency controlled by the authorities. They are not really concerned about minor instances of tax avoidance; the primary concern is that large scale economic activity c…

> The key thing is ensuring that all exchanges of wealth only occur within a currency controlled by the authorities. I don’t think even this is a requirement. Really all you need is all large transfers of wealth to be reported to central governments so they can collect tax, and enforce money laundering prevention rules. Don’t think a government really cares what currency you use, fiat or crypto, as long as they get t…

They care a lot about control over credit markets. The entire premise of central banks controlling inflation via the money supply becomes precarious when people are able to issue and access credit outside of the controlled money supply.

You're entirely right that they want their cut, but they also don't want to end up like a country such as Indonesia or Vietnam where all the financing has to be organised in the USA. The US FED can print money during a recession to ease credit conditions; many non-western countries have no such luxury because while they might have a sovereign currency, all the serious enterprise in their country is financed in New York and cities in Western Europe.

Re: EFF to FinCEN: Stop Pushing for More Financial Surveillance

#88

Post by dralley »

nmlnn wrote: post #67
avianlyric wrote: post #62

Earlier quoted context omitted.

If you’ve seen the real harm that caused in the world by money laundering, you would be less inclined to condemn its prevention. I’ve personally seen cases of money laundering where the money comes from sexual exploitation, human trafficking, modern day slavery, organ trafficking, high value thefts (petrol, or digits bank robberies), standard social engineering scams etc These aren’t special one of events, this happe…

> sexual exploitation, human trafficking, modern day slavery, organ trafficking, high value thefts (petrol, or digits bank robberies), standard social engineering scams etc That kind of logic can be used to justify putting government cameras and microphones inside everyone's homes too.

Yes, but that doesn't mean that going to the very opposite extreme is the right response. Nobody is itching to emigrate to Somalia.

Re: EFF to FinCEN: Stop Pushing for More Financial Surveillance

#89

Post by koheripbal »

codethief wrote: post #73
ve55 wrote: post #2

The way I usually phrase this situation is something like "The goals of a strong government are in direct opposition to the goals of most modern cryptocurrencies", and this is yet another subset of those goals where we can see the forces fighting against each other. I find it hard to convince myself cryptocurrency can win out in the long-term, as the more rules they find ways to skirt around via technology and decent…

> You can spend a decade developing a provably-anonymous cryptocurrency (which we have indeed now done) Looks like I've been out of the loop. Which cryptocurrency are you referring to?

Monero (XMR) is the most notable example, but there are other coins that implement the same technology of truly anonymous and untraceable transactions.

FinCEN will not change their course. From their perspective, they would rather try to kill or stifle all cryptos than allow illegal activity to be done within that market without an ability to seize assets or trace funds.

Right now they have total control over traditional non-cash monetary transaction - and the US gov't specifically has a long reach into the global economy to enforce things like OFAC and sanctions.

Cryptocurrency openly defies that power base by design (censorship resistance). There is fundamentally no solution here where the two will play nicely together.

Cryptos will simmer in the background as the section of the global economy they facilitate grows (black market transactions), and erode the western financial power base. It's mostly limited today by the lack of scalability in the coin networks.

I wonder if there's a future where innovation in scalability allows for a single crypto to reign supreme globally and eliminate all national currencies in our lifetime.

It would be a monumental shift of power, which will undoubtedly involve a great deal of political/technological struggle and civil chaos.

Re: EFF to FinCEN: Stop Pushing for More Financial Surveillance

#90

Post by drtillberg »

CryptoPunk wrote: post #52
drtillberg wrote: post #45

The main real-world uses for bitcoin are (1) evasion of currency controls and (2) facilitation of extortion and fraud. That's all illegal, btw. The surprise is FinCEN didn't act until now to align its surveillance of bitcoin with the rest of the financial world. I also would speculate that the short action timeline and comment period have a typically cynical purpose to deploy one of a grab-bag of regulatory actions a…

>>Bitcoin isn't worth fighting for here, sorry EFF, but it is a useful canary warning about the current state of low financial freedom and privacy (by historical standards) and surprising degrees of unofficial suppression of viable alt-moneys. I would be happily surprised if the FinCEN reg forced unlawful use cases out of the bitcoin ecosystem leaving a vibrant, healthy marketplace.... This is a completely incoherent…

Let me simplify it.

The bitcoin ecosystem is a cesspool of ransomware payoffs, international money laundering and speculation. Eliminate 2 of those use cases via financial surveillance and I will be happily surprised if the 3d survives, or if any similarly robust marketplace springs up from the ashes. Because the bitcoin ecosystem is such a mess, it's not worth saving, in my opinion. It's a feature, not a bug, and it gives all alt-moneys a bad reputation.

I don't like dragnet-style financial surveillance, in general. If it bothers you when applied to bitcoin for philosophical reasons, it should bother you more when applied to other alt-moneys with less nefarious uses.

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