Crypto Mixer developers are arrested in Netherlands

[tainted_love]

This is scary news for those of us who value our privacy.  The developers of the Ethereum mixer Tonado.cash have were arrested by Dutch police early today.  The police state are frightened by (y)our privacy, and are now showing how they are the real threat to democracy.  This isn't isolated to one country, this is a global concern.

It started with news of the USA sanctioning the crypto mixer, which broke yesterday.  Guard your privacy, people.  If you are crypto user, you are a threat to them.

USA Sanctions Tornado.Cash: https://www.wsj.com/articles/tornado-cashs-sanctions-show-shift-in-crypto-regulatory-focus-11660336224
Dutch Police Arrest Developers: https://www.msn.com/en-us/news/world/dutch-cops-arrest-dev-behind-sanctioned-crypto-mixer-tornado-cash/ar-AA10B44f

Sorry for posting this in the bitcoin section.  Even though it's related to an altcoin mixer I think it's more broadly about all crypto currencies.  If I'm wrong, moderator please more where appropriate.

[NotATether]

Nowadays your safety is at the will of the US government. They alone can decide who to arrest, who to sanction. It's best not to arouse the beast in vain.

And don't think it's Biden doing the whole thing, there's a whole network of administrators working on this that ends at the secretary of state.

P.S. "Administrators" - haven't we come up with a better word for what most other countries would call ministers?

[bittraffic]

The guys running Tonado.cash who supposedly provides anonymity for his clients is pretty much exposed and is now in custody. On the other news, it says Suspected developer of crypto mixer Tornado Cash/ Alleged Tornado Cash developer arrested in Amsterdam. So he isn't confirmed whether it's him or not. It'd be scarier if they are also going after the users of Tornado Cash.

[franky1]

when cryptocurrencies were defined by fiat law as currency. (circa 2014-5) instead of remaining as a digital product/good. things changed

yep it may have made some think it legitimised bitcoin, but it also allowed an entrance by regulators to start putting rules on businesses that interact with cryptocurrencies

the guys at tornado were not arrested for just being a mixer. it was that they were caught allowing PEP (politically exposed people) from russia, who are currently banned from trying to move value out of russia

..
side note
mixers no matter who uses it, no matter the source of funds. no matter the destination of funds, are treated as a suspicious activity by regulators where businesses that are regulated have to red flag anyone that uses a mixer no matter the reason or purpose someone has for using a mixer.

the same applies to coins/tokens with privacy enhanced features
this is things like monero, liquid, and others

the same applies to sidechains, subnets/altnets bridging to main net blockchains, where such side/sub/layered networks are advertised as privacy networks
this is things like LN,

this is not to say that mixers are illegal. but they are categorised as services that put users of service under suspicion and put on a watch list.

..
some people think that mixers are not regulated and not meant to cause mixer users to be put on watchlists. and these people will try the foolish hardest to try to get everyone to use a mixer pretending it hides users.. yet by using a mixer actually puts a big neon arrow on users and makes them get watched far more.
yep the regulation for businesses to watch users of mixers, creates a scenario where mixers then do not protect privacy. because now people are put on a watch list due to using a mixer.

in short
if there was 2 people waling down a street. one guy walking normally. no one cares, he isnt doing anything suspicious.
and the other guy told to jump in a black box. where its closed off and several black boxes are thrown into the street so that for a 20 yard stretch you cant tell which one is the one with the guy in it.. is 'privacy'.. however when the guy gets out. he is then watched for every movement he does afterwards and also by seeing him get into the box, they can back trace his actions before getting in the box, and that is watched too..

suddenly even if he never done a crime. all of his actions before and after using a mixer is now on a highlighted watchlist.

thus defeating the point of a mixer.

[Anonohmon]

The guys running Tonado.cash who supposedly provides anonymity for his clients is pretty much exposed and is now in custody. On the other news, it says Suspected developer of crypto mixer Tornado Cash/ Alleged Tornado Cash developer arrested in Amsterdam. So he isn't confirmed whether it's him or not. It'd be scarier if they are also going after the users of Tornado Cash.

in fact they ARE going after users too from what I hear.

This is entirely unconstitutional and it's because we're not doing enough to make our voices heard in discontent that they're getting away with this. It's insanity. The USA is becoming the most evil totalitarian dystopia on the planet.

At least the DPRK was always consistent with its totalitarianism.

[franky1]

The guys running Tonado.cash who supposedly provides anonymity for his clients is pretty much exposed and is now in custody. On the other news, it says Suspected developer of crypto mixer Tornado Cash/ Alleged Tornado Cash developer arrested in Amsterdam. So he isn't confirmed whether it's him or not. It'd be scarier if they are also going after the users of Tornado Cash.

This is entirely unconstitutional and it's because we're not doing enough to make our voices heard in discontent that they're getting away with this. It's insanity. The USA is becoming the most evil totalitarian dystopia on the planet.

At least the DPRK was always consistent with its totalitarianism.

nothing to do with USA
it was the dutch.. so constitution does not apply

[mindrust]

Crypto will lose its anonymity if it wants a mass adoption. When the developed countries start regulating crypto, they won’t let you stay anonymous. They’ll want to know who you are and what you do. That’s how governments work. Mass adoption won’t happen for free. It will come with a price. The price is your freedom.

[franky1]

Crypto will lose its anonymity if it wants a mass adoption. When the developed countries start regulating crypto, they won’t let you stay anonymous. They’ll want to know who you are and what you do. That’s how governments work. Mass adoption won’t happen for free. It will come with a price. The price is your freedom.

this is not a reason to now scare people into thinking everyone is on some watch list where government agents are watching you 24/7(like certain people in another topic are trying to elude to to pretend bitcoin is not fit for purpose)

the government (simple logic and research) do not have the capability to watch everyone.

instead the government ask BUSINESSES to watch a particular set of people. people that do suspicious things. like using privacy tools.

so not everyone is being "watched"
but if you are using a privacy tool. then expect you are on a watch list and expect the chances of your details being passed onto the government is higher than someone who does not use privacy tools

[Poker Player]

I am not surprised.

States have an unlimited voracity for revenue and a hunger for control of the same magnitude.

We have recently learned that the IRS will be increasing its staff.

At best, Bitcoin privacy in the future will be like privacy with cash: most people will only be able to have it with small amounts.

Remember that legislation is underway in the EU to KYC all transactions, of any amount.

Be careful what you do, guys.

Crypto will lose its anonymity if it wants a mass adoption. When the developed countries start regulating crypto, they won’t let you stay anonymous. They’ll want to know who you are and what you do. That’s how governments work. Mass adoption won’t happen for free. It will come with a price. The price is your freedom.

You are right. It will happen a bit like with the internet, in its origins there was more privacy than now, although there are still spaces of privacy for those who care.

[mindrust]

^ When the internet first came out, you were free to say whatever you want. The internet was freedom. The wildest form of freedom. Now there is a hidden auto control mechanism in everybody that prevents him/her from saying silly stuff. (Even 4chan ain’t free imo) Especially in where I live, you can’t even criticize certain people because the gov lap dogs will report you in a second.

The internet is not free anymore. It is not as interesting as it used to be neither.

Crypto will probably follow the same path.

I stopped watching TV 20 years ago and started doing the internet thing but now the internet is the new TV.

Still… God bless adblock/ublock origin

[OgNasty]

Nobody wants to see developers arrested (for the most part) but this idea being pushed that “code is speech” is ridiculous. Anyone who has been involved in the FreeRoss movement can tell you that there are definite consequences for writing code that can be used for illegal purposes. What we’re seeing here is the beginning of the end of the Wild West in crypto.

[m2017]

The guys running Tonado.cash who supposedly provides anonymity for his clients is pretty much exposed and is now in custody. On the other news, it says Suspected developer of crypto mixer Tornado Cash/ Alleged Tornado Cash developer arrested in Amsterdam. So he isn't confirmed whether it's him or not. It'd be scarier if they are also going after the users of Tornado Cash.

They must have left the users for "dessert" and will deal with them later if there is such activity started. If the fight against the supporters of privacy and anonymity has started openly, then they are unlikely to leave users using mixers without their attention. Apparently, a new era in the history of cryptocurrency begins. But one should not be discouraged by such unpleasant news, because it can result in positive changes for the community. You're not ready to give up your privacy so easily, are you. So, the search for new opportunities will begin.

[hZti]

This is scary news but also understandable since your business can very easily be connected with money from criminal sources. This is always a bad situation, but also it is not for shure that you go to jail for it. In my opinion the fee for the mixer is basically to cover for that risk.

[franky1]

This is scary news but also understandable since your business can very easily be connected with money from criminal sources. This is always a bad situation, but also it is not for shure that you go to jail for it. In my opinion the fee for the mixer is basically to cover for that risk.

bitcoin 2009-2014 got away with many things because those good old days, it was treated as a product/good (like trading pokemon cards) thus currency laws did not apply

but when it got mainstreamed and legally recognised as a currency.. yep currency laws then applied
and so willingly and knowingly working for a criminal, makes you a person aiding and abetting a criminal

[kryptqnick]

In the article about the Tornado, I think I've seen an example of a reasonable usage of a crypto mixer for something other than money laundering and over-obsession with privacy: it's in the part where Buterin says he used Tornado to anonymously financially support Ukrainian troops. That actually makes sense as a case where one would want to remain anonymous but isn't doing anything illegal per se (unless funding an army of a foreign country is illegal somewhere, which it might be, but I'm not aware of that). Of course, plenty of people crowdfund for weapons for Ukraine nowadays without anonymity, but I understand why some wouldn't want to risk it. But also, it does seem like the idea that mixers are largely used for illicit activities is more than a speculation, and profiting from a service that is used for money laundering is a crime...

[dothebeats]

Crypto mixers are always at the mercy of law enforcement agencies.

The fact that your service can literally help criminals launder their money even without your knowledge is what the law enforcement uses as a justification of their actions against mixers. They don't need to get even the slightest bit of evidence that the mixing service is catering money launderers, they just have to have 'reasonable suspicions' to raise the alarms and perform their "duty."

[franky1]

In the article about the Tornado,

In its sanctioning of Tornado Cash, the U.S. Treasury cited its use by the North Korean hacker group Lazarus Group and the laundering of over $103.8 million from the hacks of the Horizon Harmony Bridge and Nomad Token Bridge earlier this summer.

https://www.fiod.nl/arrest-of-suspected-developer-of-tornado-cash/

FACT suspects that through Tornado Cash has been used to conceal large-scale criminal money flows, including from (online) thefts of cryptocurrencies (so-called crypto hacks and scams). These included funds stolen through hacks by a group believed to be associated with North Korea. Tornado Cash started in 2019 and according to FACT it has since achieved a turnover of at least seven billion dollars. Investigations showed that at least one billion dollars' worth of cryptocurrencies of criminal origin passed through the mixer. It is suspected that persons behind this organisation have made large-scale profits from these transactions.

aka aiding and abetting criminal activity.. a currency law that existed years before cryptocurrency existed.

using crypto does not make currency laws obsolete.
what you find is that pre 2014 crypto was not considered a currency by law enforcement and thus crypto didnt apply to currency laws. but now mainstreaming of crypto now classes crypto as currency. currency laws also apply to crypto

pre 2014.
a mixer would have not been classed as a laundering service or a 'money mule' but instead classed in similar respects as a pokemon card shuffler tool. where by it has nothing to do with money.

but now crypto are defined as 'money' by many countries. those laws and definitions of AML apply to crypto services

[so98nn]

That’s really bad news because considering bitcoin as pseudo anonymous in nature does not give us full privacy. Coin mixers were the one who added extra layer of security. In fact it is necessity due to the fact that whenever I am getting money from foreign land, let’s say USA then I am not sure if the sender had it bought through legal ways or not? Or whether he is buying with illegal money and stuff like that. To avoid getting linked with such activities I would be more reluctant to use coin mixer services and pay extra for the same. Yes it’s use might be done for the laundering but it’s everywhere in the fiat too but can’t restrict for the normal users right? That’s why it’s bad news. I think Services like chipmixer need to be more prompt now while providing their services.

[coupable]

That’s really bad news because considering bitcoin as pseudo anonymous in nature does not give us full privacy. Coin mixers were the one who added extra layer of security. In fact it is necessity due to the fact that whenever I am getting money from foreign land, let’s say USA then I am not sure if the sender had it bought through legal ways or not? Or whether he is buying with illegal money and stuff like that. To avoid getting linked with such activities I would be more reluctant to use coin mixer services and pay extra for the same. Yes it’s use might be done for the laundering but it’s everywhere in the fiat too but can’t restrict for the normal users right? That’s why it’s bad news. I think Services like chipmixer need to be more prompt now while providing their services.

From what I understand from the articles published on the Internet about what happened to the two developers, the suspension was not due to the fact that they developed a crypto-mixer, but because the activity of their service was related to users from Russia. Of course, this presents the forms from a new angle, which is the extent of the credibility of the service that they are developing. If they were unable to hide their identities, were they really able to hide the identities of the users of their platform .

[BITCOIN4X]

In the article about the Tornado, I think I've seen an example of a reasonable usage of a crypto mixer for something other than money laundering and over-obsession with privacy: it's in the part where Buterin says he used Tornado to anonymously financially support Ukrainian troops. That actually makes sense as a case where one would want to remain anonymous but isn't doing anything illegal per se (unless funding an army of a foreign country is illegal somewhere, which it might be, but I'm not aware of that). Of course, plenty of people crowdfund for weapons for Ukraine nowadays without anonymity, but I understand why some wouldn't want to risk it. But also, it does seem like the idea that mixers are largely used for illicit activities is more than a speculation, and profiting from a service that is used for money laundering is a crime...

I also think this issue has something to do with the situation of Russia and Ukraine, but certainly not limited to other issues that may involve this service being accused of being a service that facilitates illegal acts including money laundering and the like. The increase in crime especially regarding illegal money transaction has prompted the government to act to take precautionary measures, but I'm not really sure how the government will rate mixer services (altcoin or bitcoin).

I haven't read the full news (would love to do that now) but for now that's my assumption about the situation.