Ransoms and mixers

[Wary]

Won't help them if mixers keep the logs. See my original post.

Mixers won't keep logs. That's the whole point of mixing.

Some may for a short period, but any criminal organization is more than capable of running their own mixers. They aren't that difficult to set up.

You still haven't read my original post. I respect your persistence   Mixers that don't keep logs, will get blacklisted, so all coins you put through them will become "untouchable" too. Provided majority of bitcoin users will really want it.

[1714837762]

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[Explodicle]

Won't help them if mixers keep the logs. See my original post.

Mixers won't keep logs. That's the whole point of mixing.

Some may for a short period, but any criminal organization is more than capable of running their own mixers. They aren't that difficult to set up.

You still haven't read my original post. I respect your persistence   Mixers that don't keep logs, will get blacklisted, so all coins you put through them will become "untouchable" too. Provided majority of bitcoin users will really want it.

How does anyone know which addresses correspond to coin mixers, and which mixers don't keep logs? There are a few we all know about, but probably some private mixers too. All it takes is one successful mix at any point in the future after the ransom has been paid.

How do you know your blacklist administrator hasn't been bribed by kidnappers or the NSA? Centralization = failure.

Why are we talking about hypotheticals? Right NOW there is a currency where the users unwillingly support the abduction and killing of innocent people. It pays for men with guns and predator drones to conquer whole countries and establish dictatorships. It takes from the poor and gives to the rich. Surely this bad PR would have destroyed it by now?

[giantdragon]

This may be good idea, but only if you will be happy with <0.01 BTC/USD price

[CasinoBit]

There was a topic recently: "what can kill bitcoin", and one of suggested answers was "A kid kidnapped, ransom paid in bitcoins, track lost in a mixer". Such a news would attract huge media attention and can seriously damage BTC reputation. What if, god forbid, taking BTC for ransom becomes common among kidnappers? Can we prevent it from happening, i.e. keep track of these coins?

And more generally, is there a way to keep track of "dirty" coins, while still having "honest" coins anonymous? So that real criminals won't be able to use their ill-gotten money, while honest tax-avoiders will still be safe?

Can it be done by some technical means, like coloured coins? Or by some reputation means? Something like this: there is a blacklist of "dirty" addresses (in a server or embedder in the blockchain). If the payment came from a "dirty" address, the transaction will be rejected by miners and eventually rolled back. As for mixers, to prevent from being associated with dirty money (and eventually getting blacklisted by miners), they would want to keep log of transactions, with addresses! An average mixer customer, naturally, won't come to a "tax-friendly" mixer, that reports them to authorities. But he also won't go to "dirty" mixer. First, because he (most likely) don't approve criminals. And second, because he don't want to get blacklisted himself. So, the honest folk will still enjoy their anonymity, while the Earth be burning under criminals' feet.

What if a kidnapper kidnaps a kid, demands gold as ransom and then pays someone to melt the gold into new bricks, will gold be banned forever?

As for your second question no, bitcoin will never become less efficient than what it CAN be so that dumb-ass humans will be able to behave less responsibly with their children, I just love it when people blame the bullets not the killer, blame the knife not the stabber, blame the drugs not the addict, blame alcohol, cigarettes, gambling, blame the Big Mac and not the person jamming it down his throat every day.

[BlackLilac Jordan]

Rather than blacklisting coins or anything along those lines I would prefer to see the major mixers (blockchain.info, inputs.co, etc) at some point develop a system to work with law enforcement and courts to prevent the mixing of coins that have been used in serious or violent crimes. Anonymity is a crucial aspect of Bitcoin but at some point there will have to be more co-operation between law enforcement and corporate Bitcoin services and exchanges.

Whatever the tor mixer is called (bitcoinfog?) that is used almost exclusively for the silk road will never comply, and competition will arrive that does not use any system like this. Some mixers could be created by criminals themselves fairly easily. However I believe that providing some system of regress or  tracking for coins used in crimes such as those theorized in this thread is likely, if not inevitable among Bitcoin businesses that wish to operated legally in most countries.

[firefop]

There was a topic recently: "what can kill bitcoin", and one of suggested answers was "A kid kidnapped, ransom paid in bitcoins, track lost in a mixer". Such a news would attract huge media attention and can seriously damage BTC reputation. What if, god forbid, taking BTC for ransom becomes common among kidnappers? Can we prevent it from happening, i.e. keep track of these coins?

And more generally, is there a way to keep track of "dirty" coins, while still having "honest" coins anonymous? So that real criminals won't be able to use their ill-gotten money, while honest tax-avoiders will still be safe?

Can it be done by some technical means, like coloured coins? Or by some reputation means? Something like this: there is a blacklist of "dirty" addresses (in a server or embedder in the blockchain). If the payment came from a "dirty" address, the transaction will be rejected by miners and eventually rolled back. As for mixers, to prevent from being associated with dirty money (and eventually getting blacklisted by miners), they would want to keep log of transactions, with addresses! An average mixer customer, naturally, won't come to a "tax-friendly" mixer, that reports them to authorities. But he also won't go to "dirty" mixer. First, because he (most likely) don't approve criminals. And second, because he don't want to get blacklisted himself. So, the honest folk will still enjoy their anonymity, while the Earth be burning under criminals' feet.

I will actually take the opposing stance. I believe that such an event as you've described would do wonders for bitcoin... everyone would hear about it and how it they got away with the money. Nobody who's serious about bitcoin becoming what we know it can become is interested in the direction you seem to want to take it. Honestly, I would love to have a mixing service built into the protocol so it wouldn't require any actual service at all.

[Wary]

How does anyone know which addresses correspond to coin mixers, and which mixers don't keep logs? There are a few we all know about, but probably some private mixers too. All it takes is one successful mix at any point in the future after the ransom has been paid.

Yes, we don't know who owns address. But we know the addressed. If some other coins went to the same address (that's how mix works, right?), too bad for them: they'll get dirty too (And drop in value, since dirty money will be accepted only for big premium, if at all). Therefore, an owner of clean coins won't want to mix them with dirty coins. When you sen you coins to a mixer, you'll use only a "clean" one - the one that can prove to you that it does keep logs. Criminals can open their own mixers too, but since no clean money will go there, they would just mix dirty coins with other dirty coins. It may help in court (deniability), but won't restore value to the coins.

Centralization = failure.

To a point only. There is a tradeoff, like with everything else. Why, for example, we have just one heart, rather than a dozen or a thousand of them?

Right NOW there is a currency where the users unwillingly support the abduction and killing of innocent people. It pays for men with guns and predator drones to conquer whole countries and establish dictatorships. It takes from the poor and gives to the rich. Surely this bad PR would have destroyed it by now?

Do you think average Joe (We are talking mainstream adoption, right?) would agree with your diatribe? Would he rather say: "Us killing them is not murder, but self-defence. Nothing to be ashamed of. While kidnappers and their tool - bitcoin can't be tolerated. We should potect our children.".

This may be good idea, but only if you will be happy with <0.01 BTC/USD price

Cheap coins! Good!

What if a kidnapper kidnaps a kid, demands gold as ransom and then pays someone to melt the gold into new bricks, will gold be banned forever?

Isnt's it already? When was the last time you've used a gold coin to pay for something? Or even a $500 bill? Gold is out, cash is next.

I just love it when people blame the bullets not the killer, blame the knife not the stabber, blame the drugs not the addict, blame alcohol, cigarettes, gambling, blame the Big Mac and not the person jamming it down his throat every day.

It's in human nature to put the blame wrongly. Are you saying that for bitcoin become mainstream, human nature have to change first?

Rather than blacklisting coins or anything along those lines I would prefer to see the major mixers (blockchain.info, inputs.co, etc) at some point develop a system to work with law enforcement and courts to prevent the mixing of coins that have been used in serious or violent crimes. Anonymity is a crucial aspect of Bitcoin but at some point there will have to be more co-operation between law enforcement and corporate Bitcoin services and exchanges.

Whatever the tor mixer is called (bitcoinfog?) that is used almost exclusively for the silk road will never comply

There is double pressure - from tax/drug autrorites, for complete transparency and from folks that want privacy, but don't want to help real criminals. Under these pressures bitcoim may eventually branch to 3 brands: whitecoin (tax-friendly), graycoin(drug-friendly), and blackcoin(thug-friendly).  

[Wary]

Nobody who's serious about bitcoin becoming what we know it can become is interested in the direction you seem to want to take it. Honestly, I would love to have a mixing service built into the protocol so it wouldn't require any actual service at all.

  I don't want to take it in one particular direction. Centralisation is evil I've suggested 3 possible paths: (tax/drug/thug)-coin. Maybe I should set a vote, to see what would people here prefer.

[FreeMoney]

Governments used to issue currency until it was used for kidnapping ransoms and other bad stuff.

[Rampion]

This same discussion is regularly brought up by some newbie who doesn't know/care about using the search function.

You simply do not ban cash because the bad guys like it. Nobody thinks about banning the USD because is the official black market currency. If the masses are so stupid to not understand that, maybe the world is not ready for monetary freedom.

[AliceWonder]

Won't help them if mixers keep the logs. See my original post.

Mixers won't keep logs. That's the whole point of mixing.

Some may for a short period, but any criminal organization is more than capable of running their own mixers. They aren't that difficult to set up.

You still haven't read my original post. I respect your persistence   Mixers that don't keep logs, will get blacklisted, so all coins you put through them will become "untouchable" too. Provided majority of bitcoin users will really want it.

How do you blacklist a mixer? Seriously?
They usually don't re-use addresses. It's not possible.

[Snail2]

Always the first tradeoff is the hardest. The second and third will be more and more easier and the twentieth will be almost natural... 
Because of these FUDers sooner or later we will see that Bitcoin source will be owned by Microsoft and the Federal Reserve will have the "mining rights"...

[AliceWonder]

Always the first tradeoff is the hardest. The second and third will be more and more easier and the twentieth will be almost natural... 
Because of these FUDers sooner or later we will see that Bitcoin source will be owned by Microsoft and the Federal Reserve will have the "mining rights"...

It's FOSS - it can't be "owned" like that.

[Snail2]

Well yes and no . Just remember what happened with OpenSolaris.

BTW try to imagine a scenario when in a future release of Windows/OSx/Commercial Linux distros (like Redhat) you will find an embedded bitcoin client. Nothing fancy just a simple client with little almost negligible modifications like a hard coded payment proxy/bridge to the bitcoin network, then after a patch the proxy will be changed to to a payment gateway (as MS-BTC has been hard forked in the background). Updates coming and going and at some point there are no more gateway as the two networks are separated. Certainly you can "bleach" your evil bitcoins to honest bitcoins for a small fee. As thanks to MS/Apple/etc the newbitcoin industry is grooving fast and people asking more more security functions... Finally we will have a secure, regulated, closed source bitcoin network with tens or hundreds of millions of users and a small "wild bitcoin" network, stuffed with nerds, gangsters and FBI agents .

[AliceWonder]

Well yes and no . Just remember what happened with OpenSolaris.

BTW try to imagine a scenario when in a future release of Windows/OSx/Commercial Linux distros (like Redhat) you will find an embedded bitcoin client. Nothing fancy just a simple client with little almost negligible modifications like a hard coded payment proxy/bridge to the bitcoin network, then after a patch the proxy will be changed to to a payment gateway (as MS-BTC has been hard forked in the background). Updates coming and going and at some point there are no more gateway as the two networks are separated. Certainly you can "bleach" your evil bitcoins to honest bitcoins for a small fee. As thanks to MS/Apple/etc the newbitcoin industry is grooving fast and people asking more more security functions... Finally we will have a secure, regulated, closed source bitcoin network with tens or hundreds of millions of users and a small "wild bitcoin" network, stuffed with nerds, gangsters and FBI agents .

I can't speak for Windows or OS X but I do not see either including a bitcoin client.

With respect to Redhat - Fedora is the distribution that most people use, not RHEL (or it's free CentOS clone).
Packages in Fedora are submitted by the user community and most of them maintained by the user community.
This is done is an open fashion with a public record of who makes what changes.

The source RPM is available and pristine upstream source is very important.
Any patches are applied at build time in the RPM spec file, and thus listed in the RPM spec file, making it easy to see and read what patches are applied.

Sneakery like changing a payment proxy in an update patch would be suicide for the fedora project.

I mean no offense but I get the impression you don't have a lot of experience with how these open source projects work. Many of the people heavily involved in Fedora and Debian are very hard line when it comes to pristince source with any patches both scrutinized and justified with attempts to get the patch upstream whenever possible.

Look what happened to Ubuntu when they tried to shove amazon adware on their users - it was quickly exposed a bunch left for Mint, and those that stayed, many of them disabled Unity and the adware crap.

The whole point of open source software is many eyes, and those many eyes are there.

I've not packaged for Fedora recently but when I did, not only did the source tarball have to match upstream checksum but even the timestamp had to match - or the package wouldn't be approved. They are very serious about keeping as pristine as possible and only using patches when absolutely necessary (security or bug fixes)

[AliceWonder]

Oh - and here's what happened with OpenSolaris:

Prior to Oracle's moving of core development "behind closed doors", a group of former OpenSolaris developers decided to "fork" the core software under the name OpenIndiana. The project, a part of the Illumos Foundation, aims to continue the development and distribution of the OpenSolaris codebase.

(wikipedia)

There's not a damn thing Oracle can do about it either.

[Explodicle]

How does anyone know which addresses correspond to coin mixers, and which mixers don't keep logs? There are a few we all know about, but probably some private mixers too. All it takes is one successful mix at any point in the future after the ransom has been paid.

Yes, we don't know who owns address. But we know the addressed. If some other coins went to the same address (that's how mix works, right?)

No, they create a new address for each customer. They will always be one step ahead of the blacklisting authorities.

Centralization = failure.

To a point only. There is a tradeoff, like with everything else. Why, for example, we have just one heart, rather than a dozen or a thousand of them?

We have billions and billions of hearts! At least as far as p2p software is concerned, 100% decentralization seems to be working well.

Right NOW there is a currency where the users unwillingly support the abduction and killing of innocent people. It pays for men with guns and predator drones to conquer whole countries and establish dictatorships. It takes from the poor and gives to the rich. Surely this bad PR would have destroyed it by now?

Do you think average Joe (We are talking mainstream adoption, right?) would agree with your diatribe? Would he rather say: "Us killing them is not murder, but self-defence. Nothing to be ashamed of. While kidnappers and their tool - bitcoin can't be tolerated. We should potect our children."

I'm not willing to sell out what I believe in just to get rich quick. And that's assuming a blacklist would work, would result in greater adoption, and would stop short of becoming USD 2.0. Personally I only found out about Bitcoin when I found myself unable to donate to Wikileaks because of a blacklist.