bitcoin from illegal activities

[rustynailer]

TLDR: step into my van

[Blawpaw]

I'm curious now what they called the bitcoin from illegal activities. I know it but just forgot the term they called it.  Just like the bitcoin from alphabay and other sites from tor. I wanna know how they make it become clean bitcoin except using mixers. Maybe there is a wallet now that will make it a fresh bitcoin without the stain from illegal activities. Or it still the mixers they used?

I guess it is the same with cash. How many paper notes do we use every day that are tainted with criminal activity? Every form of money will always be used for criminal activity one way or another...

[blackmachinegun]

bitcoin significantly is not illegal. which makes it illegal is how to use it.

I think bitcoin is also illegal, according to the government
because there are no rules and regulations to regulate the bitcoin
That's why bitcoin illegal and banned in many countries

[rustynailer]

bitcoin significantly is not illegal. which makes it illegal is how to use it.

I think bitcoin is also illegal, according to the government
because there are no rules and regulations to regulate the bitcoin
That's why bitcoin illegal and banned in many countries

That's not how things work, every new invention is legal until your gov makes a law that says otherwise and not everything has to be regulated. 

[Indianacoin]

I wish there was a burning feature for tainted coins in exchange with a freshly prepared coins.

Let us assume A sold cocaine(from a fake address) to B(an Undercover agent) for BTC. Now after B pays him, A then transfers the coins to a so-called "furnace wallet" where those tainted coins gets burned for a freshly generated coins in lieu of some transaction fees. And the whole process of burning and generating is to be done by miners for some extra subsidy. So that even if A cashes out the daughter coins, B will never be able to identify him in any way. Neither will he be able to perform taint analysis (https://blockchain.info/taint) anymore

But this feature is a tough one to implement.

[praprata]

bitcoin significantly is not illegal. which makes it illegal is how to use it.

I think bitcoin is also illegal, according to the government
because there are no rules and regulations to regulate the bitcoin
That's why bitcoin illegal and banned in many countries

If there is no rule about that bitcoin illegal is I think is just legal.
For me bitcoin is always have been legal is just how use it what he said.

If you do it illegal things than you are not that always save. So just do bitcoin for legal things.

[maokoto]

In my view, is the activity that is tainted, not the coins. Lets say something receives X ammount of BTC for selling drugs. Then he pays X ammount to buy a tablet in a site accepting Bitcoin. Part of the coins are now in the hands of the merchant who sold the tablet.... how can that money be considered "tainted"? He obtained it lawfully.

[owm123]

In my view, is the activity that is tainted, not the coins. Lets say something receives X ammount of BTC for selling drugs. Then he pays X ammount to buy a tablet in a site accepting Bitcoin. Part of the coins are now in the hands of the merchant who sold the tablet.... how can that money be considered "tainted"? He obtained it lawfully.

Yes, but this works for fiat money, as there is law that says that with each transaction, cash looses its history. Thus cash is fungibile. For bitcoin, there is no such law.
http://jpkoning.blogspot.co.id/2016/01/what-makes-money-special-lawyers.html



And even if there was, where would it be? usa only? what about all other countries? Its a lot of problems. So merchants may prefere to avoid tainted coins and work with blockchain analytics companies. For example, it seems bitpay is already doing exactly this by working with chainalysis company and actively rejecting tainted coins:

https://www.reddit.com/r/Bitcoin/comments/4012hu/bitpay_is_actively_cooperating_with_chainalysis/

which explains this previous post:

https://www.reddit.com/r/Bitcoin/comments/3mea6b/bitpay_is_blacklisting_certain_bitcoins_rejecting

[PakistanHockeyfan]

Bitcoin no longer has that many illegal practices as of now. If we were to focus on more routes of making sure money laundering is no longer happening within Bitcoin, we would be fine in terms of having a better reputation for Bitcoin. Bitcoin will indeed be the future of money if we just focus on making it better.

[The Sceptical Chymist]

future solution
make silk road only use 'dash' (darkcoin)
then let the druggies play with dash coins illegally and then swap for clean bitcoins. that way bitcoin doesnt touch silkroad directly

That would make 'dash' less valuable (and likely much more volatile) than Bitcoin.

Who would "make" them use a particular coin?

well what do you think dash was invented for..
the whole point of dash's extra anonymity features was to be used for the dark market.. so let them play with the dark market and sever bitcoins tie to that stuff

Franky, do you have any sort of reference for this?  And I'm not challenging you, I'm just curious and I've never used anything on the dark market myself.  I'm curious but not that curious, so I don't know who takes Dash there.  If anyone.  Seems like it would be a good coin to buy illegal stuff with, and I know it was originally called Darkcoin.

[owm123]

future solution
make silk road only use 'dash' (darkcoin)
then let the druggies play with dash coins illegally and then swap for clean bitcoins. that way bitcoin doesnt touch silkroad directly

That would make 'dash' less valuable (and likely much more volatile) than Bitcoin.

Who would "make" them use a particular coin?

well what do you think dash was invented for..
the whole point of dash's extra anonymity features was to be used for the dark market.. so let them play with the dark market and sever bitcoins tie to that stuff

Franky, do you have any sort of reference for this?  And I'm not challenging you, I'm just curious and I've never used anything on the dark market myself.  I'm curious but not that curious, so I don't know who takes Dash there.  If anyone.  Seems like it would be a good coin to buy illegal stuff with, and I know it was originally called Darkcoin.

There are reports of some darknet markets adopting dash/darkcoin, e.g.,
http://www.tripwire.com/state-of-security/latest-security-news/silk-road-reloaded-adopts-i2p-anonymous-network-and-darkcoins/

But in minority. Most darknet is using Bitcoin, and no one is going to change this anytime soon. One reason is  that there is entire market there for "cleaning" the bitcoins using mixers, or what not. Non of these services will allow real anon coins to take over, as they will lose their "small fees" for the cleaning. Second reason is that Bitcoins are easier to buy and sell with cash, without any exchanges. You can only get anon coins on exchanges.

[eternalgloom]

Didn't the FBI auction a massive amount of coins from the Silk Road bust?
Those must've been as tainted as they could be, but does the auctioning provide some sort of provenance which 'washes' the coins?

[owm123]

Didn't the FBI auction a massive amount of coins from the Silk Road bust?
Those must've been as tainted as they could be, but does the auctioning provide some sort of provenance which 'washes' the coins?

Its tricky questions. I think they were "officially cleaned" by the fact that they were put on action by FBI. But then this would only be valid in USA. Thus ppl and exchanges using these coins in EU, Australia or whatever, could still find them as dirty. USA law does not apply outside USA.

[CreativeCarol]

Bitcoin is just always going to have illegal activity available. It's really really hard to do certain things with Bitcoin because of the reputation. I keep trying to get random people like friends and whatnot to try it but they just don't care.

[jonathgb25]

entirely possible that some services are being run by government agencies so that they can secretly maintain a database of the source and destination of each "mixed" quantity.

I think it is unlikely because taint is not proof of ownership.

Imagine the following scenario:

Alice sells 1 BTC worth of cocaine to an undercover DEA agent and
then sends that 1 BTC to Bob for a loan.

Bob tries to sell the 1 BTC to coinbase and cash it out.

DEA agents show up at Bob's house.

Bob says: "But that Bitcoin came from Alice!  I never sold any cocaine!"

How does the DEA know whether the Bitcoin (which has 100% taint)
came from a third party or was simply passed from one address to
another?  (They can't).

They can trace that if the bitcoins were not mixed and washed properly. You can do it by sending different amount of bitcoins to multiple addresses and mixing it again with new coins.

[MWesterweele]

Bitcoin is always connected to illegal activities.Cause of its anonymous transactions and wireless transactions.Bitcoin are use to buy drugs online buy weapons and to some pornsites.Bitcoins can be use in all illegal activities online thats why bitcoin from illegal activities.Because bad people benefits of its features.

[smooth]

Bitcoin is always connected to illegal activities.Cause of its anonymous transactions and wireless transactions.Bitcoin are use to buy drugs online buy weapons and to some pornsites.Bitcoins can be use in all illegal activities online thats why bitcoin from illegal activities.Because bad people benefits of its features.

Porn sites (assuming they follow some basic rules on age of talent, etc.) are not illegal, at least not everywhere.

It is a good example though, of something that is often legal but still considered high risk and can cause problems with regulated entities, and also something that many people want to do but not be identified as doing.

[Blackmet]

Bitcoin is illegal in differen countries just cause of this illgeal activities and also cause banking system can't controll, also with mixers is unreal to find a criminals and other bad guys.

[miningdude]

Bitcoin are begin used for illegal activities like buy guns etc which its not good for the BTC future

[newcoins1978]

Its used for criminal activities but what many people already said is that every currency is and I think we cannot stop this.
The fact is that its maybe easy with the bitcoin but with other currency's it can also be done easily because it also a sort of untraceable who is behind it.