Is bitcoin just for criminals and terrorists?

[MoonShadow]

Your local wallet's addresses can be explored on http://blockexplorer.com/ just type one of the addresses you recently sent coins to in the box and click on the addresses in the table to explore.

This is true, but it doesn't change anything.  You can search your own addresses and see what you paid for because you have the secret knowledge necessary to make sense of that info because you were the one who did it.  Give those same addresses to your cop buddy, and send him to the blockexplorer site, and ask him if he can figure out what you bought or from whom without your help.

[xf2_org]

Your local wallet's addresses can be explored on http://blockexplorer.com/ just type one of the addresses you recently sent coins to in the box and click on the addresses in the table to explore.

This is true, but it doesn't change anything.  You can search your own addresses and see what you paid for because you have the secret knowledge necessary to make sense of that info because you were the one who did it.  Give those same addresses to your cop buddy, and send him to the blockexplorer site, and ask him if he can figure out what you bought or from whom without your help.

Silk Road takes deposits on their site, which winds up being a concentration point of illegal activity.  It will show up quite clearly on a heat map, and could potentially be identified by depositing and withdrawing a certain amount of tracked coins, at certain intervals.  A tech-savvy cop buddy could observe (a) bitcoin-like network activity at Bob's house, and (b) a flow towards the Silk Road "concentration" in the block chain.  Observe several data points over time, and you can build a decent body of data evidence.  Or simply observe Bob's web browser and BlahBlah Tor Site generating network activity at similar moments.

Serious anonymity takes a lot of work, and is darned near impossible if you are making a "noticeable" impact on the network, with your activity.

New users should get into bitcoin with their eyes open. Various amounts of tracking are already done with cash-purchased prepaid phones and debit cards.  If it's an electronic record, it can be data mined for patterns of money flows.  The government is quite skilled in picking signal out of noise, even encrypted noise.

[MoonShadow]

Your local wallet's addresses can be explored on http://blockexplorer.com/ just type one of the addresses you recently sent coins to in the box and click on the addresses in the table to explore.

This is true, but it doesn't change anything.  You can search your own addresses and see what you paid for because you have the secret knowledge necessary to make sense of that info because you were the one who did it.  Give those same addresses to your cop buddy, and send him to the blockexplorer site, and ask him if he can figure out what you bought or from whom without your help.

Silk Road takes deposits on their site, which winds up being a concentration point of illegal activity.  It will show up quite clearly on a heat map, and could potentially be identified by depositing and withdrawing a certain amount of tracked coins, at certain intervals.  A tech-savvy cop buddy could observe (a) bitcoin-like network activity at Bob's house, and (b) a flow towards the Silk Road "concentration" in the block chain.  Observe several data points over time, and you can build a decent body of data evidence.

This is still easier said than done.  Like anyone else, Silk Road's internal escrow system can use a different address for every trade.  In practice, this means that successful trades simply show up in the blockchain as A -> B, and then sometime later B -> C.  If you can associate B to Silk Road, you can then assume that both A & C are dealing in illicit goods over Silk Road; but not only can you still not prove that, you don't know who they are and you can't find other Silk Road addresses as a result because even teh normal client will use exact value transactions without mixing them.  And if the values are a round number common on Silk Road, say an even 10 BTC, then even knowing who A is doesn't tell you if C was his dealer, as Silk Road could pay out to the dealer from any single matching transaction.  This is exactly how the bitcoin laundry works.  The client doesn't do this kind of thing right now, but it can be done.

[drsaul]

I hear a lot of talk about this but I'm not sure I get it.

Aren't USD used to do everything illicit and illegal under the sun including pay for assassinations, war, and environmental destruction?
Aren't USD just as easy or easier to hide from the tax man's thugs than bitcoins?  The IRS has no hidden camera in my mattress. 
Don't most  "C&TO"  use USD to do business?

 


   

[grah]

In this thread a bunch of people who know nothing about anonymity or computer security or money laundering (and Creighto) talk about why Bitcoin is worse than USD at protecting "criminals"

[grah]

Also how are they going to tell Bob is using Bitcoin at a given time? Doesn't Bob use Tor to obfuscate protocols? How do they find Bob in the first place? I don't think you guys understand the model. I will make it short for you.

"Criminals" win
Feds lose and walk off with their tails between their legs

kthnxbye

[fergalish]

This has gone a bit off-topic.  The point was that a bitter insider or a police/law accomplice could, maybe, quite easily bring about the financial ruin of a criminal organisation.

I mean, how many of you would trust your best friend with your wallet.dat?  Would you ask him to turn around when you type your passwoord or passphrase?  Is your wallet.dat even encrypted?  I daresay any C&TO that deals in bitcoins will take serious measures to protect their wallet.dat(s), but it would just take one person, one time, to take it all away from them.  Therefore, C&TO's will not deal in bitcoins. 

That's the hypothesis.  Is it valid?

[n0m4d]

it would just take one person, one time, to take it all away from them.  Therefore, C&TO's will not deal in bitcoins. 

However C&TOs currently handle their finances will lead to the answer.

Perhaps they'll buy insurance.

[MoonShadow]

This has gone a bit off-topic.  The point was that a bitter insider or a police/law accomplice could, maybe, quite easily bring about the financial ruin of a criminal organisation.

I mean, how many of you would trust your best friend with your wallet.dat?  Would you ask him to turn around when you type your passwoord or passphrase?  Is your wallet.dat even encrypted?  I daresay any C&TO that deals in bitcoins will take serious measures to protect their wallet.dat(s), but it would just take one person, one time, to take it all away from them.  Therefore, C&TO's will not deal in bitcoins. 

That's the hypothesis.  Is it valid?

Only if the organization is small and has a central command & control that is paranoid about their funds, and keeps them all in the same place.  Like any organization, C&TO's are really just groups of people acting in concert.  Bitcoin lends itself well to the movement of funds in any case, and the most likely use of Bitcoin for any organization is the compensation to their dispersed agents.  A snitch could easily get a low ranking agent's wallet.dat, but how useful that data is to tracking the funds of the organization in general depends on just how savvy they really are.  We've all seen the stupid pot dealers, they are the one's who end up in jail.  But what about the smart one's?  I've personally met a professional dealer that used a day job in the construction industry as 'cover' and was never prosecuted even though he was a 'known' criminal who had been arrested repeatedly.  Capturing an agent's wallet.dat makes tracking of funds possible but it doesn't make it likely or useful; as this requires much classic investigations beyond the digital realm.  A captured wallet.dat only lets the police watch the payments of one guy, it still doesn't tell them who the other agents are or anything about them.  For all the cops know, the wallet.dat that they captured could be the agent's personal wallet.dat, and they could be watching him buy carrots.  By definition, if the cops are watching an agent and have his wallet.dat, they already believe him to be an agent.  The data in the blockchain doesn't add any new evidence to this end, although it could be used in court to prove payments had been made in larger amounts than he paid for in taxes.

[trentzb]

The IRS has no hidden camera in my mattress. 

Ahh, but now they know you have a mattress and where to look.

[fergalish]

it would just take one person, one time, to take it all away from them.  Therefore, C&TO's will not deal in bitcoins. 

However C&TOs currently handle their finances will lead to the answer.
Perhaps they'll buy insurance.

I don't know that that's true.  Look at the government - if bitcoins take off, then the way the government handles its finances will be *very* different.  Me too.  Most people too.  C&TO's too, I presume, if they buy into it.

Only if the organization is small and has a central command & control that is paranoid about their funds, and keeps them all in the same place.  Like any organization, C&TO's are really just groups of people acting in concert.  Bitcoin lends itself well to the movement of funds in any case, and the most likely use of Bitcoin for any organization is the compensation to their dispersed agents.  A snitch could easily get a low ranking agent's wallet.dat, but how useful that data is to tracking the funds of the organization in general depends on just how savvy they really are.  [...]  Capturing an agent's wallet.dat makes tracking of funds possible but it doesn't make it likely or useful;

I'm not talking about obtaining a C&TO's wallet.dat so you can trace their activity.  I'm talking about obtaining the wallet.dat, then transferring the funds to your own wallet.dat, leaving the C&TO without any funds to pay their dispersed agents.  I mean, as long as a C&TO has their funds locked away in traditional assets, it's not easy to it all away at once.  But if a significant part of their wealth was in a wallet.dat and they lost that?  Picture, heck I dunno, a TO paying for an illegal arms shipment.  Both the buyer and the seller will appoint some individual to ensure the safe transfer of the BTCs, meaning you might have a wallet.dat worth millions of dollars.  For this reason, I think C&TOs might be reluctant to transfer into bitcoin-land.

The best defence would probably be to have all funds split into multiple wallet.dats, with no individual ever obtaining access to them all, but that seems far from perfect.

[NobleNation]

Crypto currency does make it easy to move money around and has some anonimity. But it is more transparent than the banking system and is much easier for Law Enforcement to track suspicious activity.

Whatever system in question - crypto or not, without solving the roots of where criminality stems from, law enforcement is hassling the rest of society without just doing their job.

Majority of laws are made at the whims and fancies of the politicians to serve their own ends, which unduly burden the vast majority of law abiding citizens and stifles them from freely conducting their activities.

If we have a crypto currency with trust in the individual identities and bound by a common, moral and ethical set of principles, then Law Enforcement or governments will have no moral legitimacy in trying to criminalize that crypto economic platform.

This is one of the things Noble Nation is aiming to solve.

[ivan_8d]

Of course no. Bitcoin is freedom. Why only terrorists should use it?

[FAB_coin]

Terrorism is one of the most worn out excuses implementing more regulations and limitations upon people.

[Snub]

I don't think that you can say that bitcoin is ONLY for them...but many of THEM use it...like all other technologies in our world

[WhaleHunter]

I think you may be confusing bitcoin with the US dollar... which for one century has been the number one store of wealth of criminals worldwide.

[usorin]

Okm, everybody can use cryptocurrency, including terrorism and so on, but let be real, at current time someone is financing those antisocial acts and i don't think that they have a lot of bitcoins. This argument is just an argument in the lack of it.

[babysweetTiger0401]

Of course not, everyone can use bitcoin not just for illegal activities but the main purpose here is we need to be decentralized people right now thinking when and where they should put their money. in the first place governments knows best for us they know how much money we have in our bank account, so bitcoin is here to help and get rid in our banks.

[hbcenk]

Disruptive innovations always face with resistance

Cars also can be used by terrorist to bomb

[Sesochi Maspinto]

Any tool can be misused by bad people. Crypto is just a tool.