Bitcoin used to do money laundering - will it become a huge problem?

[funkydog]

Whats your thought on this?

For a lot of criminals Bitcoins are the perfect tool to launder money or not? Almost no trace but still they have to explain how they got the money once they convert it back into dollars....
Will this become (or already is) a problem? I'm thinking that the anonymity will be a problem for a lot of governments once BTC becomes a well know payment method.

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[franky1]

the governments dont care..
their banking red flags are already good enough.

bitcoin is treated like a foreign currency or an asset (like gold or antiques in that regard)

if someone moves more than $10,000 out either by wire transfer or buying something expensive or making a large withdrawal at a bank clerks desk.. it gets flagged.
so it doesnt matter if an american is laundering via bitcoin, Euro's, antique auctions.. its all treated the same.

[funkydog]

the governments dont care..
their banking red flags are already good enough.

bitcoin is treated like a foreign currency or an asset (like gold or antiques in that regard)

if someone moves more than $10,000 out either by wire transfer or buying something expensive or making a large withdrawal at a bank clerks desk.. it gets flagged.
so it doesnt matter if an american is laundering via bitcoin, Euro's, antique auctions.. its all treated the same.

Yeah i was kinda thinking the same thing... for the USA

[Trouble821]

the governments dont care..
their banking red flags are already good enough.

bitcoin is treated like a foreign currency or an asset (like gold or antiques in that regard)

if someone moves more than $10,000 out either by wire transfer or buying something expensive or making a large withdrawal at a bank clerks desk.. it gets flagged.
so it doesnt matter if an american is laundering via bitcoin, Euro's, antique auctions.. its all treated the same.

Yeah i was kinda thinking the same thing... for the USA

In the EU I think if only 1000 euros gets moved it gets flagged by the banks because of some new regulation to stop money laundering. With that restriction bitcoin is useless for money laundering. The USA will probably copy the EU and reduce their limit to $1000 before long.

[franky1]

Yeah i was kinda thinking the same thing... for the USA

for atleast 150 countries out of the 200+ in the world have some form of flagging system.

and to be honest money laundering is less about criminal behaviour, and more about limiting customers from taking their money out on a whim.

EG ATM's have a $500 limit in most cases, UK has £300. not due to criminal concerns. but to keep 99% of peoples funds in the hands of the bank for their lovely fractional reserve processes.
there is psychology behind it.
if you had $10,000 and you could walk up to an ATM and take it all out.. you would. simply so you can go home and throw it in the air to "make it rain". and then spend it on whatever you pleased, when you pleased without having to bother walking to an ATM each time.

but by limiting your access to it. you only take out 5% at most. and then you are more thoughtful of how you spend it. because the ATM limits your usage and then reminds you that you are poorer than yesterday with its balance displays. causing people to not want to withdraw as much.. (playing into banks desires)

after all a can of car fuel and a box of matches can do alot of criminal damage for under $30, so a $500 limit is not stopping criminal activity.. even guns cost less.

wire transfers are different. because it involves bank->bank. thus fund stay in a bank, so that is more relaxed at $10,000 US or 10,000Euro.

In the EU I think if only 1000 euros gets moved it gets flagged by the banks because of some new regulation to stop money laundering. With that restriction bitcoin is useless for money laundering. The USA will probably copy the EU and reduce their limit to $1000 before long.

EU wire transfer regs are 10,000, not 1000

[countryfree]

It is very difficult to use BTC for money laundering, unless you don't want to exchange it to fiat at some time. Most money launderers are trying to invest in real estate or legit businesses and that's nearly impossible with BTC. You sure can buy pizzas and ice-creams with BTC but that's not what money launderers are trying to achieve.

[Amph]

the governments dont care..
their banking red flags are already good enough.

bitcoin is treated like a foreign currency or an asset (like gold or antiques in that regard)

if someone moves more than $10,000 out either by wire transfer or buying something expensive or making a large withdrawal at a bank clerks desk.. it gets flagged.
so it doesnt matter if an american is laundering via bitcoin, Euro's, antique auctions.. its all treated the same.

what if he does not exchange them for fiat, but... he buy directly at phisical shop or face to face or whatever? no re flag can happen in that case, and anyone can basically move thousand of dollars without the governments noticing anything

[brg444]

Let's hope this sector gains more growth in the coming years!

Bitcoin is agnostic, anyone that finds value in using it creates value for Bitcoin's economy while starving fiat governments of resources.

A win-win! 

[eddie13]

The problem is mostly the negative publicity associated with it IMO.. It's just an excuse for the media to talk bad about it because they are scared of it..

[bearex]

You could maybe buy gold or some other goods with bitcoin and then sell it for cash, so you avoid banks, credit cards etc.

[brg444]

The problem is mostly the negative publicity associated with it IMO.. It's just an excuse for the media to talk bad about it because they are scared of it..

The people who swallow this "negative publicity" BS are mostly ignorant regular joes who largely hold no value.

Let the media talk, people with large pockets looking for a secure way to hide their wealth might notice and figure out there might be something for them in Bitcoin 

[funkydog]

The problem is mostly the negative publicity associated with it IMO.. It's just an excuse for the media to talk bad about it because they are scared of it..

The people who swallow this "negative publicity" BS are mostly ignorant regular joes who largely hold no value.

Let the media talk, people with large pockets looking for a secure way to hide their wealth might notice and figure out there might be something for them in Bitcoin 

Spot on! This is what i'm hoping for

[owm123]

Whats your thought on this?

For a lot of criminals Bitcoins are the perfect tool to launder money or not? Almost no trace but still they have to explain how they got the money once they convert it back into dollars....
Will this become (or already is) a problem? I'm thinking that the anonymity will be a problem for a lot of governments once BTC becomes a well know payment method.

It should not be a proplem if ppl actually understood how btc works. bitcoin is not anonymous: http://www.bitcoinisnotanonymous.com/

Even bitcoin devs said that using bitcoin for illegali things is stupid:

Bitcoins ARE traceable [Interview with Jeff Garzik] | 2011 https://www.youtube.com/watch?v=9p9M1IU2k50

"its pretty blib and dumb to do a lot of illegal transactions on bitcoin when it's so easily traceable [4:33]"

[RodeoX]

It never seems to be a huge problem for dollars? Like any currency, where there is money there are criminals.

[ajareselde]

Whats your thought on this?

For a lot of criminals Bitcoins are the perfect tool to launder money or not? Almost no trace but still they have to explain how they got the money once they convert it back into dollars....
Will this become (or already is) a problem? I'm thinking that the anonymity will be a problem for a lot of governments once BTC becomes a well know payment method.

It should not be a proplem if ppl actually understood how btc works. bitcoin is not anonymous: http://www.bitcoinisnotanonymous.com/

Even bitcoin devs said that using bitcoin for illegali things is stupid:

Bitcoins ARE traceable [Interview with Jeff Garzik] | 2011 https://www.youtube.com/watch?v=9p9M1IU2k50

"its pretty blib and dumb to do a lot of illegal transactions on bitcoin when it's so easily traceable [4:33]"

I agree with you. Every imput can be traced back all the way to it's generation in block reward. If we (average users) can trace back with somewhat success, just imagine
what someone who's doing it professionaly could do.
On top of that, regulations could ask for bitcoin addresses to be registered in order to be used legally (I find this the logical step if there's continued bashing on bitcoin)

[VirosaGITS]

Whats your thought on this?

For a lot of criminals Bitcoins are the perfect tool to launder money or not? Almost no trace but still they have to explain how they got the money once they convert it back into dollars....
Will this become (or already is) a problem? I'm thinking that the anonymity will be a problem for a lot of governments once BTC becomes a well know payment method.

It should not be a proplem if ppl actually understood how btc works. bitcoin is not anonymous: http://www.bitcoinisnotanonymous.com/

Even bitcoin devs said that using bitcoin for illegali things is stupid:

Bitcoins ARE traceable [Interview with Jeff Garzik] | 2011 https://www.youtube.com/watch?v=9p9M1IU2k50

"its pretty blib and dumb to do a lot of illegal transactions on bitcoin when it's so easily traceable [4:33]"

I agree with you. Every imput can be traced back all the way to it's generation in block reward. If we (average users) can trace back with somewhat success, just imagine
what someone who's doing it professionaly could do.
On top of that, regulations could ask for bitcoin addresses to be registered in order to be used legally (I find this the logical step if there's continued bashing on bitcoin)

Its more about proving who owned what BTC at what time than tracing back anything. The BTC tracked change hand all the time, maybe hundreds of time. The problem is not telling that at X point there was a crime committed with those coins.

Its that you can't prove that the person who cashed it out is the one that committed the crime. Unless he is retarded anyways.

[Hellacopter]

I don't think so, already many criminals and terrorists used the fiat and the cash before the crypto currencies founding, so the Bitcoin currency haven't really any kind of relation with the illegal deals or transactions worldwide

[VirosaGITS]

I don't think so, already many criminals and terrorists used the fiat and the cash before the crypto currencies founding, so the Bitcoin currency haven't really any kind of relation with the illegal deals or transactions worldwide

If bitcoin has 1% of the money transaction pertaining to criminal activities, the price per Bitcoin would go in the thousands. So yes, saying BTC is criminal's money is media nonsense.

[tupelo]

Well it is not really suited for that I think. We should not forget that Bitcoin is not anonymous, the weak link will always be the purchase of the coins.

I am often wondering if some large mining operations could actually be money laundering fronts.

[ajun96]

I don't think so, already many criminals and terrorists used the fiat and the cash before the crypto currencies founding, so the Bitcoin currency haven't really any kind of relation with the illegal deals or transactions worldwide

we don't know, they use bitcoin or not
perhaps they was used because secret and unkown,  we don't know,
important bitcoin is perfect way to launder money