Bitcoin Forum

Suppose you made 10 legitimate bicoins by moving a lawn to your neighbor and decided to "break" the chain of bitcoin transactions to have some fun on Silk Road.

You used some eWallet mixing service, which ends up like this:
Your Service -> You 1 -> eWallet 1
                                   eWallet 2 -> You 2 -> Silk Road -> Joy!

You had pot shipped to your door and had fun.
What you didn't know is that CIA and NSA is tracing illegal nuclear arms deal by setting up a trap pot store on Silk road.
Here's the whole picture:
Arms Buyer -> Arms Seller -> eWallet 2 -> You 2 -> Silk Road -> Joy!

Some coins that were involved in original arms deal are now tracing back to innocent *you*!
... and now CIA is after you as a potential suspect involved in illegal arms deal.
When they found that you're just an innocent loser - they just send you to a local police for "correction" :)

So my point is that using bitcoin mixing service might make things worse.

True/false?

How can they prove you actually own the private keys ?

Do bitcoin transactions contain your dna ?

tl;dr your evidence is entirely circumstantial.

My point is that potentially criminal (under investigation) chain of transactions is now attached to physical address of an innocent person after using of innocent mixing service.

If you send coins to silkroad and withdraw those same coins you will not receive the same coins back.

lolwut?

Don't use SR... how is it a mining service? You don't  mine by cutting grass...

Exactly how would they go about tracing those coins (that were previously involved in an arms deal) to *me* ?

No, they're now after the owner of 18mEomvQhK36UTAFYimkTa6CMgnLVKc3vY. Good luck sending that to local police for "correction" :)

Also, suppose address A has 50 BTC that was involved in an arms deal. There are also unrelated addresses B - Z.
Now there is a transaction from addresses A - M (i.e. 13 addresses A, B, C, etc together), transferring a total of 3000 BTC to addresses N - Z.
Who owns those 50 'arms deal' coins now?

Well that's part of the point.

You are not the only one laundering the coins through that service. Many many many people are. It just so happens that one of those addresses paid for drugs. And there really should be no way for them to link that back to you. It's part of a laundering service that so many people use is and are connected to it.

Silk Road would have to have a leak that meant having the drugs shipped to you was the issue. In that case it wouldn't matter at all what you did with your coins, how you paid for them, nothing. The issue there would only be that you had drugs shipped do you. In this case the only leak that needs to happen is with Silk Road. But I just don't see that happening. I could be wrong though.

Unless you mean other people in that laundering network are paying for illegal things and you are not or whatever. In that case I go back to the fact that too many people are using that same laundering service (or should be..) and they would not be able to track that one address back to you... And once again, that is part of it. They wont pin the purchase on you but they also wont pin it on the other guy or the 100s of other people who used that service.

The arms dealer's coins are also mixed. So, the coins you get from the arms dealer can't be traced back to them either.

So by this logic, if Wikipedia started accepting Bitcoins for donation purposes then they could, 'potentially' be in harms way because their donated money 'could' of been part of this arms deal as well.

Your Service -> You 1 -> eWallet 1
                                   eWallet 2 - > You 2 -> Wikipedia -> Donated.

Same logic and flowchart of process of funds, so it completely makes it false.

I don't really worry about something like this, they would be going after a btc address and can't tie any proof to you

Im pretty new to this, but a question that I think is related. Do most bitcoin users have multiple wallet addresses for different purposes? I see a lot of people in this forum placing a wallet addresses in their signature or in posts they make when asking for donations etc. If I am thinking about this correctly, potentially if you used one of these wallet addresses here (and your profile and/or posts give you away as who you really are) and then also in your Silk Road senario that could be enough for authorities to make a connection? So back to my question, is it common practice to have multiple wallets to handle different types of transactions?

kcgreene.

Clarification to my above post. I think me saying "wallet addresses" is the wrong thing. What I mean to say is "btc address".

You are right. That is one way of finding out who owns what addresses. Having separate wallets helps, but passing bitcoins back and forth between wallets will suggest some sort of association.

Interesting, thanks for the feedback.

This is really a non issue.   Mixing dilutes the transaction to the point any link would not be substantial enough to use in court.

It would be like convicting someone for cocaine trafficking because trace amounts were detected on a dollar bill they had in their wallet. 

What wdBTCtracer said.

You would end up with a fraction of the arms deal coins, no where near enough to prove a comnection to the original arms deal.