Bitcoin Forum

Are blockchain-based transactions easy for money laundering?

Lol, dont even get into that,  you will get caught out in the end. I am self employed and I declare every penny I make Its just not worth trying to launder money

I recommend not laundering money as well, always be legal guys. But you must consider this too:

When governments make bitcoin illegal (and they will sooner or later) they will ask people to deposit their bitcoins on the government's hands, just like they asked for people to put gold into the government's hands in 1933.

The difference is gold does not have a blockchain, but bitcoin has, so if you declared your bitcoin, you are already on the list of "person that owns bitcoin" so you will be the first to get a letter by the government asking you to give them all of your btc. Consider that.

Money laundering is about turning dirty money into clean money so that you can openly spend it. How would you declare money on illegal income?

Money laundering on blockchain Base transaction.
I read a news before that IBM said banks will be migrate to blockchain in fact 15% of the banks worldside use blockchain and the rest will follow.
If blockchain is not secure banks will waste time and money to migrate to blockchain. so money laundering be hard to do in the blockchain.

I wouldent even consider trying to obtain dirty money in the first place on an illegal income Its just not worth it.

Wow. That is one hell of a question to be posted here.
I dont think there will be one who will suggest you one website.
Well, actually we dont know, maybe there are some of them out there who are doing it already.
It is one of the things that the government are trying to avoid.

There are many stories on the web. BTC shares an anonymous transfer can be used for this. It is sad. There will always be people to use good things in a bad way.

Indeed, the problem is bitcoin is such a grey area, that im scared that the government wouldn't like the evidence one presents when you cash out and they decide to steal all of your funds.

For example I've explained before how I did some trades on Mintpal, and Mintpal now does not exist. This mean that I have money on my wallet coming from an address that cannot be proved to belong to a licit source because the exchange does not existing anymore so I cannot log in on there and prove that I received it from my trading account and I also lost my trading history on Mintpal (and others like Cryptsy) because they disappeared out of nowhere and when I woke up I wasn't able to get an updated trading history downloaded.

Now these Bitcoins im worried to sell because what if they don't like the explanations I gave?

Im also worried about one time that I sent 1 BTC to some mixer to test things out and learn how a mixer works. So when I recieved the money back into my wallet... now I can no longer prove that I obtained them here in a signature campaign (for example).

So they only money I could prove that I obtained in a licit way are from signature campaigns, from trading in exchanges that are still not dead and I control the accounts like Poloniex, and from buying and selling as usual. But other than that, a lot of my BTC I think would lead to problems if I tried to cash them out... this makes me sad because it's a good chunk of my savings. What would you do?? I never did anything illegal to obtain my BTC and I would be pissed that the government confiscates them from me when I sell these and they don't like my explanations.

In short No. You should take a look at my free course Bitcoin and Government (https://bitcoinhomework.com/course/bitcoins-and-government/).

Here is a little excerpt from it

Nearly all the highly economically developed countries have embraced crypto-currencies, and are currently rewriting legislation to make it taxable as either a security or a currency. What makes you think that it's going to be banned? Bitcoin is just as difficult to trace as cash, and yet cash remains.

It's not the technology that aides money laundering it's the thief's process for sequencing transactions. If you want to launder money you can do it in all sorts of ways, you don't need the blockchain.

Cryptocurrency exchanges are doing a great job combating instances of money laundering through the account verification and know your customer processes. I think this is a good thing!

No? It has nothing at all to do with the blockchain. Heck, it may even be detrimental to money laundering considering the fact that all your transactions are recorded on a public ledger.

The only reason why governments are concerned with money laundering using Bitcoins is its ease of use. Get an address, and you can send and receive money, and no one can do anything about it. It can be traced, yes, but there are ways to make that harder, and it may still be more convenient than laundering traditional money.

Thats a risky move,and it can affect the government's mindset about cryptocurrencies if you got caught with millions of dollars using BTC they might ban all the crypto in the whole country.

i think it is not, bitcoin transaction can tracked. if it enter market, they can give law enforcer the data of user's account if needed. so i think it is hard to laundry money

Truth to be told - when you are a knowledgeable accountant, it is far easier to launder money using old fiat based methods than cryptocurrency.
The general public thinks that cryptocurrency is some kind of holy grail invention which will allow all kind of new money laundering schemes.
This is not entirely true, there are far more superior money laundering designs already invented...

It seems like so many people don't want to pay their taxes on their crypto gains.  I don't get it.  To me this is the quickest and easiest money I will probably make in my entire life.  Why not pay the taxes on it?  And sleep like a baby at night in the process.

Just my two cents.

Also if you have to go to a message board to learn about money laundering, you probably shouldn't do it.

I think it's very problematic to do this, because you will still exchange through an exchanger or other structure, where this money will appear.

Not every cryptocurrency is good for money laundering. For example, Bitcoin isn't anonymous at all, it is fairly easy to track transactions. Some governments probably developed tools which help them with tracking every single payment. Some people use Bitcoin mixers to hide their real identity but I would recommend to use Zcash or Monero instead. Their transactions can't be tracked. Cash transactions are also not traceable so what's the problem with cryptocurrencies?

easy or not it all depends on each individual bro, because not everyone is smart to spin their money so it is not detected and if I do it myself yes just happy because it was used to do it

Not necessarily. You can turn your Bitcoins directly into goods or services. If you used an altcoin to launder money you choose an altcoin - bitcoin exchange with no ID requirement. After you've successfully obtained Bitcoins just go to an online marketplace that accepts it and buy whatever you like.
Money laundering isn't there to hide income from the government. It's there so that you can openly pay taxes and spend it, making it look like it comes from a legal business.

A newbie with 1 post asking this thing? Are you up with something fishy or related into different shady activities and you are asking if blockchain based transactions can be easy for money laundering? Don't let yourself involve with such heinous activities. Everything has been made good and it's looking bad depending on your perspective and the way you will use it. I don't support this act, don't do it please!

And why would they be? It is pretty difficult to try to withdraw money, and that is even much more difficult to launder money, and if that is what you are asking for, let me tell you that you are going to go to jail if you do it.

Be careful, i dont know why the masses are always saying that bitcoin has been created for that kind of purposes, and in fact, it is false.

It is pretty difficult to do that kind of activities, and more with bitcoin, it is a mess, and everyone who do that kind of things need to pay taxes.

Money you have to spend to be identified. BTC is open. kazra can look into operations performed. The problem in the initialization of who the wallet account belongs to.

It doesn't make sense to introduce "dirty" fiat money into the cryptocurrency ecosystem in order to clean it. There is so much friction between fiat currency and cryptocurrency, and there isn't much volume in the markets to support large scale money laundering.

There are good ways to launder cryptocurrency itself (e.g. money you receive from the DNMs). Using VPN and the TOR browser and mixing your bitcoins is one way. Strong privacy coins like Monero are another method. But it's important to note in all cases that organizations like INTERPOL and the FBI are privy to much better blockchain analysis tools than the rest of us. There may be various privacy exploits that we don't know about yet. TOR and VPNs can be compromised. You never know. As someone mentioned, if you need to launder fiat money, there are better-established, more liquid, and safer methods to do it.

This is you r first post and the only thing you want to ask about is money laundering!!

Bitcoin can be used for money laundering and other illegal activities. Bitcoin is just a new technology and you can exploit it as you want.
Stay a way from troubles, don't think you are 100% anonym even when using Bitcoin.

Well I think they can but at least in some coins I don't think they would be efective. Let's not forget that the transactions in the blockchain are public, so once they are tracked and associated to a user for some reason, they should be easy to track. A lot of people say that bitcoin is associated with money laundry, but I don't think that's true. Transactions using monero, zcash or private coins like those, might be efficient, but I don't think all blockchain-based transactions make money laundry easy.

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Well you one of very few. Not everyone lives in a country that sounds taxes reasonably. Some people live in countries where tax money is abused and government members are actually stealing it and tax papers are not getting services they should get and when they do it's poor. Then you would not even want to pay tax based on morals. Paying tax to a government that wastes it feels like you are directly supporting and encouraging government fraud. You pay tax and they get even more money to abuse. They rewarded with more money. This what I'm talking about now is one of the reasons for crypto. To he separate from the government. You don't have to declare everything but don't be stupid about it and buy a really nice car when you not declaring much. It's totally legal to do a side job besides your normal one and if you work for yourself the government doesn't need to know every little thing you do.

I think their are coins that are compatible for some illegal activities regardless they don't need blockchain but they use anonymous coin to make a transactions. but some of coins required to transaction using blockchain.

I don't even know why people are trying so hard to attach money laundering to bitcoin because just like other fiat currencies you can not determine how one should use his money and so if they use it illegality it is up to the system to apprehend them rather than blame it all on bitcoin.

Never even think of money laundering, You need to earn money legally It can be questionable in the end you know.

This is the reason why crime syndicates and corrupt government officials are hiring IT experts. That’s why governments should band together to counter this.

blockchain technology can really be used in money laundering.
since it provides users an anonymous way of doing their transactions and governments as of now doesn't have the capability to trace.
so if anyone does use it for laundering then it could be used.
but i would advise you not to do it though.
 

Money laundering is much easier with normal cash, just open a front business and fake the sales and deposit the clean money in the Bank, like most money laundering operations work or open a strip club. Why go through all that trouble to learn Bitcoin and then take the risk that some exchange might block your account, when you convert large amounts of fiat?

Bitcoin is also pseudo-anonymous and cash is almost 100% anonymous. ^smile^

Having to think of it, I think there is a possibility, but it would be done indirectly rather than directly. Money laundering is the process of making dirty money or illegally obtained or produced money seem to come from a legal and legitimate source. It can be done in many ways, and I think the possible practices that can be tied up with the cryptocurrency market is if an illegally obtained money would be used to buy and invest in the cryptocurrency market. I actually think that that would be a smart option to divert the attention of the authorities because once money is converted into cryptocurrency holdings and be dealt with, it won't have the paper trail  that most money-related processes have; however, if the authorities would track the person who personally used the money, then there can still be a chance of identifying the perpetrators.

Yes. They took advantage on its anonymity in order to clean the dirty money they have stole without the notice of investors. Most of them are syndicates the are producing pyramid scheming investments.

could be possible cause there are so many ways cryptocurrency can be used  for illegal actions as mentioned above is only the top of the iceberg

Suppose a corrupt politician official goes to an investment bank. Said official has a ton of money, and since they have a ton of money then then bank is likely to want to bend the rules to get that money in the system. It turns out that because banks are too big to fail, that it’s unlikely that someone will go to jail for helping the official, and the worst thing that will happen is that the bank will get fined.

cryptocurrency does have many ways, many people who use it in any way they think. so we should not be surprised too if bitcoin users that many and have many ways. so in a lot of ways then people are looking for profit from bitcoin.

Money laundering remains serious concern in our country. I'm against with this, I wanted to earn money in a legal way with effort and hardwork.

Money laundering is an ancient trade those who have surplus money of their own will involve in this business to convert their bad money into legal. And to double their asset.Secondly who want to become fast to get a prominent place in the society will do the money laundering.

Its possible to launder money but most exchanges have Anti Money Laundering and Know your Client policies to ensure that money isnt being diverted around.

Good luck I mean I suppose you can try but in the end you are going to be living in fear your whole life and wondering whether the tax man will come and collect. If you make a bundle pay a little tax and be on your way.

Not for long. Cash remains temporarily while governments work on their cash-removal agenda. Have you really not realize yet that physical cash is going to be removed in the next decade or two?

And once they remove cash, do you really think that they are going to let people continue having financial freedom with bitcoin? they aren't going to remove cash to see how everyone starts using bitcoin, they will try to ban it. The good news is, no amount of banning will stop it, it will continue rising because there will always be a demand for financial freedom.

The problem is, if you want to buy real state with bitcoin... you will not be able to do it, at least easily, you would need to find a country where it's not banned and move there.

Even without Bitcoin it was possible that the dirty black money been getting cleaned. Until the rise of BTC other modes were used to help clean black money. But yes BTC just gave an extra option to those people who used to do such acts. I believe that is the reason few countries banned and is planning to close down the exchange for a while I guess.

Using cryptocurrencies is an easy way for a lot of crimes. Some experts think that authoritarian countries are supporting cryptocurrencies because of availability to operate with them economy that in a shadow.

to commit criminal activities can be done, not just crypto based, for people who have criminal nature it could happen for money laundering, but you will deal with law enforcement if you do that

That is one perception about cryptocurrency. That is one reason perhaps why the governments, well, some of them, are taking steps to make Bitcoin and other cryptocurrencies illegal in their territories. Money can easily enter territories without getting tracked by the government and its appropriate agencies because cryptocurrencies do not have to pass through banks. That is perhaps another reason why the policies about identity verification seem to be brought to another level higher.

yes, I agree with you, but in my opinion to this day no one has been able to create a tool to help track every payment and block chain transaction. so it will be difficult.
and ZCash or monero are altcoins that have good plans in the future.

Don't try illegal activities, if you do then all ICO, cryptos will go illegal, anyone can do easily money laundering but it is illegal in most countries.

Those who are good and know the laws will never do such activities.

I think that transactions of bit coins are impossible because they are disclosed. Even if anonymity is a characteristic currency, it will be discovered when changing to a legal currency.

It is possible but you probably get caught out in the end anyway. They always have a way the find out what you have been up to.

There have been cases in the past where money laundering has been made possible. It is possible with crypto nature, there are as many instances that exist but only a few of those are known to the world, while others are still hiding under covers. Crypto being decentralized, also helps out money launderers to get their work done more easily. So while you exchange your money with some one, be careful and do your own diligence and then go ahead. You may end up getting into trouble.

It's a topic some bitcoin supporters rather not discuss but I think that there is no denying in the fact that money laundering can be attributed to bitcoin and other cryptocurrencies. While someone might argue that other cryptos that not in the center of the spotlight in the same way that BTC is as well as being more anonymous would be better for such purposes, but BTC still acts as a gateway in and out of crypto, being the most accepted cryptocurrency for FIAT pairs.

While blockchain transactions may only be pseudonymous (not anonymous but not associated with personal ID either), such transactions are really convenient for grey market or illegal transaction that are involving parties with online activity.

True. But that directly goes up for gold as well, and other assets of physical nature. Gold can be bought from whatever source, and after that melted into whatever number of bars that at that point can't be linked to a certain source anymore. It's less convenient than something as crypto currencies, but it offers a far better form of overall anonymity. Cash money due to the code numbering can be linked to whatever source, which decreases your overall anonymity. So, ultimately we have to conclude that gold offers a better way of money laundering if we discard the convenience aspect. I think that those who are looking for anonymity will definitely discard convenience for more anonymity whenever they can.

Yes. Because of this block chain technology people can easily put their money and no one can trace i. This is one reason why governments are afraid of legalizing bitcoin or adopting it in the economy because there is really a risk that corrupt officials or people with a bad intention used block chain technology for illegal activities that can never be prevented nor detected.

Governments will always focus on money laundering.  But it is important to remember that Bitcoin and other cryptocurrencies have so many legitimate uses that it is unfair to lump them all together and label everything "money laundering."

These are the possible reason's why some certain country banned bitcoins, and as we all know, it is decentralized and nobody has the ability to control its flow , aside from that, people in the forum stands anonymous, so it means it is hard to track down their identity,  

I can happen because I think the banks can’t determine where the money came from and thats the other reason why some country are banning bitcoin in their place.

who the hell is capable of melting down their gold, though? that definitely sounds like something i would need to outsource. there are privacy mechanisms available to the bitcoin ecosystem to maintain similar levels of anonymity (mixing/coinjoin, TOR, VPN, etc), but it's possible that these mechanisms may be broken by attackers (like governments).

the biggest problem is that typical users take no care of their privacy. they freely reuse addresses, link wallet addresses, deposit to services without generating new addresses, they don't spoof their IP address, they don't use fake names and email addresses to deal with payment processors and merchants. that makes them low-hanging fruit. don't be low-hanging fruit.


it depends on the level of inconvenience (or perhaps rather the cost). one thing to consider here is that while gold has a very liquid market, KYC is relevant in the gold market as well. anytime i've ever sold gold pieces to a dealer, i've had to provide my ID.

the alternative is to deal P2P. i'll bet you the market for P2P cryptocurrency trading is bigger than for gold, even this early in the game, because cryptocurrency can be traded globally on the interwebz....

Criminals might be using cryptocurrency to practice money laundering since it's pseudo-anonymous it's true that it helps alot.
That's a cause why governements start banning cryptocurrency.Although I think with cryptocurrency or without it there will always be money laundering so it's just a waste to ban cryptocurrency ( not even talking about the fact they can't really ban it since they can't proove that you own it)  ???

In case someone would be interested, lets say that you bought ether at a exchange, so it is easily traceable and the gov can check you had it. How would you make it "dissapear"? That is, not laundering but avoiding all tax?

I think illegal things don't last for long so no one should consider bitcoin as money laundering. Always be legal no matter how needy you are

Maybe it's not so easy but it's convenient and it's easier to hide the traces and the origin of funds comparedto fiat money. Investigations techniques are mor complex for cryptocurrencies and that is why criminals like to use them for money laundering. But still I don't think taht we can talk about such large sums like when fiat currencies are involved.

Yes,it is because it can be anonymous which is why the Korean government today announced that accounts on exchanges must be link to a real bank account.

Truly when you are a learned bookkeeper, it is far less demanding to launder cash utilizing old fiat based strategies than digital currency.
The overall population feels that digital money is some sort of heavenly chalice creation which will permit all sort of new illegal tax avoidance plans.
This isn't altogether valid, there are much more unrivaled tax evasion outlines as of now imagined.

It's really easy actually, that's why many banks started to consider crypto trading as being money laundering and they close the accounts of the holders.

Don't get me wrong. If you are asking here to use the blockchain to launder money, then it's up to you but don't regret when you got caught. Money laundering is illegal, if you know it.

But if you are asking here the other way around, then yes it can be. As we know, the blockchain is a perfect tool for illicit activities because the transaction processed in the blockchain is completely anonymous.

can not be denied that bitcoin is the most powerful weapon for money laundering. because of the pseudo-anonymous bitcoin properties. making it difficult for the government to track the movement of money and know the ownership of money. what else bitcoin until now can not be in taxes because of anonymous. this is what makes the government afraid of bitcoin. a very good technology but can be used for crime.

Off course not.
Sure you have a lot of money laundering in the Bitcoin business, but you have it in every second thing in the world.

You declare every bitcoin transaction you do? I wouldn't do that. And it's not illegal. The government can say its own currency is or is not illegal, but bitcoin? It doesn't belong to any country in a specific way.

Exactly. There will probably be one day in which you will be allowed to have a wallet only if it is associated to you personally. Since majority of the people will comply, all the others will be discovered because of the transparency of the blockchain history of transactions.

Bitcoin Money Laundering is, in my opinion, one of the more telling things to do unless bitcoin is a real alternative to existing currency, otherwise the money laundering process will always be the dollar-bitcoin-dollar process-that is, always Need to enter the banking system now strict money-laundering regulation to pervert, and bitcoin all online delivery, will leave full marks In contrast, art money laundering more reliable than bitcoin, faster, revenue is also Higher, so even if someone used money laundering, I believe it is a very small number.

The birth of cryptocurrencies is intended to protect the security and anonymity of transactions, but it has, to some extent, met the demand for funds transfer for such activities as crimes and money laundering. Technology is recognized but the methods and practices used are not Control, which led many countries to prohibit the flow of bitcoin and other transactions

If you convert your bitcoin/altcoins into Monero and other similar coins, then it makes the process a lot simpler. But as with every intention and new upgrade to technology, you will always have the good and the bad. Ying and yang, sometimes the good needs the darkness in order to see the day of light.