Mixer restrictions

[LoyceV]

First, here, we need to admit that Bitcoin has a problem:  Its transparency is a design flaw, which Satoshi knew about, didn’t know how to fix, and underestimated the impact of.  Mixers are a Band-Aid on a gaping wound.  Bitcoin’s blockchain is like publishing your bank statements in an append-only database on the Internet.  Mixers add a thin layer of privacy:  For ordinary users, mixers make it point-and-click to not publish your bank statements on the Internet.

I wouldn't call it a design flaw, I'd call it a design choice. It's a choice that brought Bitcoin where we are today.

Now compare Monero, which is banned from centralized exchanges in EU-countries. Owning Monero isn't illegal, but governments don't like privacy and want an ever growing amount of information about everyone. If Bitcoin would offer on-chain privacy, chances are it would be banned, and I'd argue banning Bitcoin doesn't make it better.

[NotATether]

~

Nullius, I'm curious to hear your opinion about mixer directories, and no-KYC directories in general.

How effective do you think these will be against the worldwide KYC movement?

Now compare Monero, which is banned from centralized exchanges in EU-countries. Owning Monero isn't illegal, but governments don't like privacy and want an ever growing amount of information about everyone. If Bitcoin would offer on-chain privacy, chances are it would be banned, and I'd argue banning Bitcoin doesn't make it better.

Bitcoin has become too big to be banned. The perks of making a decentralized movement!

But privacy upgrades in Bitcoin would simply be dropped by exchanges and other KYC providers, effectively crippling them. We already know Bitcoin won't hard fork for this kind of stuff, see BIP110 as an example. So the status quo isn't changing in Bitcoin any time soon.

[MarryWithBTC]

First, here, we need to admit that Bitcoin has a problem:  Its transparency is a design flaw, which Satoshi knew about, didn’t know how to fix, and underestimated the impact of.  

I am not confident that bitcoin's transparency was a design flaw by satoshi. Remember that satoshi already had a freedom ideology even before inking a word on the bitcoin whitepaper. Every design about bitcoin is people oriented, ranging from open protocol to the transparency.

The blockchain transparency was an intentional design to enable a check and verification of the 21 million bitcoin supply. If the design wasn't public, early adopters would have feared of some hidden inflation bug or so.

As LoyceV mentioned above, bitcoin would have faced the same fate of monero, especially in the early days that it was an obvious battle of bitcoin vs the government.

Meanwhile, owning bitcoin would have been classified as possessing illicit software and it would have ended up being traded in the dark places as exchanges would be forced to ban it

I intentionally didn’t make any specific suggestion about that, beyond:

[I]t would be wise to sit down with a First Amendment specialist lawyer, and figure out how to construct a test case without risk of a criminal indictment.  The problem is to make a “case or controversy” raising a constitutional law question, without a risk of jackbooted thugs kicking your door down.  I have ideas, but will not provide them here; that’s the lawyer’s job, and anyone with a legit interest in my thoughts about this can contact me privately.

Oh, I missed this part. See if you can discuss this in private with theymos, who knows he might be convinced.

[nullius]

First, here, we need to admit that Bitcoin has a problem:  Its transparency is a design flaw, which Satoshi knew about, didn’t know how to fix, and underestimated the impact of.  Mixers are a Band-Aid on a gaping wound.  Bitcoin’s blockchain is like publishing your bank statements in an append-only database on the Internet.

I wouldn't call it a design flat, I'd call it a design choice. It's a choice that brought Bitcoin where we are today.

No.  Satoshi didn’t choose this.  He wanted to build Bitcoin differently, but he didn’t know how.  Not to knock Satoshi!  It’s a hard problem.  In 2008–2010, the needed technology didn’t exist.

This post will eventually have the maximum 100 merits from me.  The list of people who have sent it merit thus far is interesting:  Bitcoin experts and legends, privacy advocates, both Zcash and Monero users.

Merited by nullius (50), garlonicon (20), o_e_l_e_o (4), Foxpup (3), ABCbits (2), Hueristic (1), BitcoinFX (1)
This is a very interesting topic.  If a solution was found, a much better, easier, more convenient implementation of Bitcoin would be possible.

Originally, a coin can be just a chain of signatures.  With a timestamp service, the old ones could be dropped eventually before there's too much backtrace fan-out, or coins could be kept individually or in denominations.  It's the need to check for the absence of double-spends that requires global knowledge of all transactions.

The challenge is, how do you prove that no other spends exist?  It seems a node must know about all transactions to be able to verify that.  If it only knows the hash of the in/outpoints, it can't check the signatures to see if an outpoint has been spent before.  Do you have any ideas on this?

It's hard to think of how to apply zero-knowledge-proofs in this case.

We're trying to prove the absence of something, which seems to require knowing about all and checking that the something isn't included.

I don’t want to make this a Zcash v. Monero issue here, but I will state briefly my own opinion:  The system that Satoshi wished for was exactly what Zcash implemented.  It’s called “commit-and-nullify”.  The basic design was invented in the 1990s^*, and it solves the double-spend problem; Satoshi evidently just didn’t know about it.  However, for a practical, private, and secure implementation on a blockchain, the needed cryptography was not developed until 2013–2016 (Zerocash research followed by zk-SNARKs edited for precision: Zerocoin research, followed by zk-SNARK research and Zerocash (which led to Zcash))... or arguably 2019–2022 (the Halo2 proof system), if you demand no trusted setup.  The way that it works is a mind-bender:  You, and only you validate your own transaction—but you run the validation program inside a Turing-complete arithmetic circuit, which proves in zero knowledge to others that you ran the program validating your own transaction.  The consensus validation code then validates your public proof that you privately validated your transaction. 🤯

The Monero people will surely have their opinions, and I respect their advocacy of privacy and fungibility.

Quick edit to add:  Another goal that Satoshi apparently sought there is not yet deployed in any coin that also provides privacy, although Zcash carefully chose their elliptic curves to support recursive zero-knowledge proofs for this.  (I should fill in details later by edit and/or later reply.)

Bitcoin devs were discussing all of this in 2013, right here on this forum; we still don’t have it in 2026.

In this message I offer a brief start of a proposal for improving the scalability, flexibility, privacy, and fungibility of Bitcoin.  [...]  In SNARKs for C: Verifying Program Executions Succinctly and in Zero Knowledge (referred to as SCIP below), Eli Ben-Sasson et al. describe their work on highly efficient non-interactive proofs with zero-knowledge for the faithful execution of programs written in C. Eli also presented at the Bitcoin conference.

^^^ The technology wound up in an altcoin, Zcash, when it should have been in Bitcoin.

Now compare Monero, which is banned from centralized exchanges in EU-countries. Owning Monero isn't illegal, but governments don't like privacy and want an ever growing amount of information about everyone. If Bitcoin would offer on-chain privacy, chances are it would be banned, and I'd argue banning Bitcoin doesn't make it better.

You forget the fait accompli factor that I described earlier in the thread.

If privacy and fungibility had been built into Bitcoin early, then advocates thereof would have stood on the high ground of accomplished facts.  But accomplished facts went in the other direction.  The discussions bore no fruit.  What should have been an MVP feature of Bitcoin v0.1.0 was shunted over to an altcoin.  And the precedent was set for Bitcoin to be a surveillance-coin that’s like dumping your fucking bank statements into a public append-only database.

The precedent is hard to undo.  And now, upon that precedent, the noose is being tightened.

With regard to CEX listings, Monero is fighting an uphill battle against the Bitcoin precedent of a transparent blockchain.  So is Zcash; they’ve had some success with a different strategy, but sometimes I fear their strategy may entrap them into compromising the project.  So is Litecoin’s MWEB, which has suffered some substantial prejudice from CEXes.

Even the term “privacy coin” is prejudicial:  It implies that non-privacy is the default and expected mode of operation for a blockchain.

If Bitcoin had been a “privacy coin” from the Genesis Block, or even if it had had privacy added around 2013 when some Bitcoin devs were interested in integrating Zerocash edited for precision: Zerocoin/Zerocash, then privacy would be the default expectation.

^* I need to provide references.  I’m writing this in haste off the top of my head, and I don’t currently have access to my old notes.  Much though I dislike editing posts, I will edit this space later to add some academic-style references.
Apologies to others, I’m slow, and I need to catch up here later.  “Warning - while you were typing 2 new replies have been posted. You may wish to review your post.”

[PrivacyG]

If Bitcoin had been a “privacy coin” from the Genesis Block, or even if it had had privacy added around 2013 when some Bitcoin devs were interested in integrating Zerocash edited for precision: Zerocoin/Zerocash, then privacy would be the default expectation.

I tend to disagree with you and agree with LoyceV.  If Monero had been the first, it would have been immediately attacked and put down.

Cypher punks are already a threat to the kind of society we are driving in to.  Back in the 2000s, the only Cypher punks people ever saw or knew about were in futuristic movies.  Bitcoin launching as a fully transparent ledger meant there was no way of really attacking it.  As a government who does shady things every now and then and has some corruption, as a government whose actions are some times questioned by the citizens, and particularly as a government planning to release Hell on Earth through complete surveillance in the following decades, how do you tell them full transparency is bad?  It would influence the people against their own plans!

They tried to tell us it was bad.  The only rope they could pull was using the Pseudonymous nature of Bitcoin to call it 'Anonymous' and using the free market to claim it is the 'currency of crime'.  Other than these, how could they have attacked it?  Tell the citizens that they can not print more Bitcoin and scarcity is bad?  Tell them that banking the unbanked is bad?

Although, as I think about it, I remember the other argument I often pull out of my deck which is very conflicting with the exact arguments I wrote above.  That is, I am also of the opinion that Monero can not be put down because the same people who want it put down are the ones who need it the most.  Because in a future society where hiding any thing is crime, they need to pretend full transparency but they would also be the first rules do not apply for.

There are recent examples I can give for my conflicting argument.  Was the Flock camera business building not recently caught having Privacy windows and not allowing video taping?  Why would they want to collect any data possible about every thing that moves on Earth while they them selves want Privacy?

I do not know if Satoshi wanted rather a Monero than a Bitcoin, but some how it all happened in a way that Bitcoin was able to survive.  As much as they want a Monero, I believe if it was first then we would not have a Bitcoin.  Or.  Maybe we would have had both, but only in the dark.

[ABCbits]

Now compare Monero, which is banned from centralized exchanges in EU-countries. Owning Monero isn't illegal, but governments don't like privacy and want an ever growing amount of information about everyone. If Bitcoin would offer on-chain privacy, chances are it would be banned, and I'd argue banning Bitcoin doesn't make it better.

Bitcoin has become too big to be banned. The perks of making a decentralized movement!

But privacy upgrades in Bitcoin would simply be dropped by exchanges and other KYC providers, effectively crippling them. We already know Bitcoin won't hard fork for this kind of stuff, see BIP110 as an example. So the status quo isn't changing in Bitcoin any time soon.

And it's already shown with how some exchange that support Litecoin and Zcash don't support withdraw to stealth/shielded address. As for Bitcoin, some exchange and blockchain analysis treat all known coin from mixer or CoinJoin as "risky", "dangerous", "tainted" or something like that.

[Synchronice]

Now compare Monero, which is banned from centralized exchanges in EU-countries. Owning Monero isn't illegal, but governments don't like privacy and want an ever growing amount of information about everyone. If Bitcoin would offer on-chain privacy, chances are it would be banned, and I'd argue banning Bitcoin doesn't make it better.

Bitcoin has become too big to be banned. The perks of making a decentralized movement!

But privacy upgrades in Bitcoin would simply be dropped by exchanges and other KYC providers, effectively crippling them. We already know Bitcoin won't hard fork for this kind of stuff, see BIP110 as an example. So the status quo isn't changing in Bitcoin any time soon.

And it's already shown with how some exchange that support Litecoin and Zcash don't support withdraw to stealth/shielded address. As for Bitcoin, some exchange and blockchain analysis treat all known coin from mixer or CoinJoin as "risky", "dangerous", "tainted" or something like that.

Bitcoin will never be banned because first of all, it's too big to ban and secondly, it's a comfortable coin for governments. It's not anonymous and chain analysis companies are getting very good at blockchain analyses. Governments can force centralized exchanges, casinos and other services to freeze coins that will be deposited from certain addresses and chain analyses companies will help them to even flag those who try to improve privacy.

The most interesting question to me is, what if Bitcoin was just like Monero when it was first created? Would they ban it ASAP or would there be a different scenario?

James Madison said this: Perhaps it is a universal truth that the loss of liberty at home is to be charged to provisions against danger, real or pretended, from abroad.

[Bitcoin-Forever]

First, here, we need to admit that Bitcoin has a problem:  Its transparency is a design flaw, which Satoshi knew about, didn’t know how to fix, and underestimated the impact of.  

If they were to be flaws regarding Bitcoin, maybe it wouldn't have a matched the successful digital currency among others, or let say maybe the entire world wouldn't have accepted to adopt bitcoin to this extent.

So what other flaws are we talking about concerning bitcoin network when we are the major reason to any encounter we are having due to our inability to understand the set up in place over this decentralized currency.

Anyone who fails to understand what bitcoin is all about can see anything you like, therefore, let's not blame such person because of their ignorance since they have chosen not to learn the actual information about bitcoin network, we only have to just ignore them and move on.

[LoyceV]

What d'you think? I think such a mixer could be what many Bitcoin users want: 100% KYC-less for small funds mixed by retailers, and still with a high chance to be relatively "safe" from law enforcement. For criminals, the mixer would be to slow to "pre-launder" the funds through them.

It sounds like you're extending the notion of taint to also label anything above $500 (or $1000) as basically tainted.
At the same time, criminals can just be patient and (after a few splits) still mix Bitcoin worth millions of dollars each year.

Advertising this service on Bitcointalk will still not be allowed:

Something is considered a mixer if it meets all of these requirements:
~
 3. The service does not collect KYC-type info from all users.

3) KYC will only enforced if ~

Who's going to enforce this KYC? Is it going to be an anonymous entity hiding in the Cayman Islands, or a registered regulated company in a strict crypto jurisdiction?

The final score, however, will be determined by AML audits. Afaik, Chainalysis, Elliptic, and other AML companies ~

That's the beauty of "selling taint stories": they all have their own definition, and they can all change at any moment. It's an attack on Bitcoin's fungibility, making people believe not all Bitcoins are equal.

Are there any cost or limit of UTXO pre-screening? If it's free, the website/service could receive DDoS by sending tons of pre-screening request.

Once the "taint" infrastructure is created, it shouldn't be too difficult to rank all 57 million funded addresses.

I remember FIOD (the Netherlands financial crime unit) declaring here in the forum that crypto mixing was not necessarily illegal, and I have seen this stance also in EU resolutions, so it depends on the jurisdiction probably.

I don't think it's possible to make mixing illegal, as it's the digital equivalent of exchanging a banknote for two smaller ones.

Has it ever been confirmed that that BTT account belonged to them?

No. But the statement can still be found on their website:

A cryptocurrency mixing service is not necessarily illegal. It is an online service that allows users to disguise the origin and destination of cryptocurrencies. With this service, cryptocurrencies are mixed with other users' cryptocurrencies for a fee. Because these transactions are kept in a public record (known as a blockchain), without using a mixer, the origin of the cryptocurrency can be traced using blockchain analytics. For this reason, some users, including criminals, choose to employ a mixer to disguise the origin of their cryptocurrency. Mixing criminal assets and concealing the origin of criminal funds is a criminal offense.

I read that at least some have speculated that they were real indeed.

Based on the timing the account emerged, that would be my guess.

[nullius]

~

Nullius, I'm curious to hear your opinion about mixer directories, and no-KYC directories in general.

To be honest, I’m way behind on the current state of things; that graces me with the ability to see recent developments with fresh eyes, but I can’t yet opine on many projects in concrete terms.

In the abstract, however...

How effective do you think these will be against the worldwide KYC movement?

Privacy and no-KYC are being ghettoized.

No-KYC used to be pretty much mainstream in Bitcoin; by no coincidence, it was so when ChipMixer could run one of this forum’s all time most-popular signature campaigns.  If you go back further, no-KYC was the default.  Now, it’s being stigmatized, and socially and economically separated from the mainstream into privacy ghettos.  Although it’s definitely advantageous for no-KYC people to organize and network amongst themselves, the increasing exclusion from the mainstream makes no-KYC increasingly vulnerable to illegalization.

Consider an analogy:  Porn.  That’s a hotbutton social issue—and thus, a salutary analogy.  For the purpose of this Meta thread, I suggest that anyone with moral or political objections to porn should take it up with me (or with my alt) sometime in Politics & Society, if at all (protip: I’m uninterested in debate).  My purpose here is not to advocate free speech for porn, but to illustrate what happens when something is stigmatized and ghettoized—approximately, in the abstract what I predict the future holds for no-KYC, if we don’t fight this as a culture-war now.


Ever since the 1960s, people in Western democracies, at least, have generally thought of porn as “legal”.  Its status varies wildly by jurisdiction; for the purposes of this Meta thread, with apologies to non-USAians, I will focus on this forum’s legal jurisdiction, the United States.  In the U.S., sexual speech has only had a tenuous legality; it is not accorded the same status and constitutional protection as, say, speech advocating the election of a Democrat or a Republican.  The things variously called “porn” have thus been subject to regulations, prior restraints, legal risks in practice, and lesser First Amendment protections.

Together with this difference in law, porn is socially stigmatized.  Relatively few people will admit publicly that they consume it—and those who produce it are socially confined to a subculture on the margins, a virtual sex ghetto.  They face negative stereotypes from the mainstream, such as the notion that all porn stars are drug addicts and generally dysfunctional.

This legally and socially marginal status makes porn vulnerable to further restrictions or bans.  Speak we of KYC?  About five years ago, I saw some religious conservatives advocate “KYC for porn”—quote-unquote; their words, not mine!  I thought the idea was so foolish, I filed it under “lolwut, that’ll never happen”.  Whoops.  The idea morphed into the now-widespread cancer of forced doxing of porn consumers, under the rubric of verifying age; the cancer then metastasized to social media sites.  We even face the prospect of “device-based age verification”—an idea which on its face cannot be adequately enforced without (a) KYCing everyone for the privilege of booting a computer, and (b) banning free and open-source OS, lest an intelligent 17-year-old edit their system sources to disable or circumvent any legally required KYC.

I’m not sure what that shows more:  The burgeoning power of the worldwide KYC-everything movement, or the impact of the stigma of porn.


Even here on this forum, with a famously libertarian administrator who moderates (or moderated, past tense?) a Reddit sub of this type, a vague, sharply enforced forum rule forbids an ill-defined category of sexual speech much broader than porn (disclosure: I’ve had a past run-in with moderators about that).

10. No embedded NSFW images anywhere. NSFW content must be marked accordingly.

31. User avatars must not contain NSFL or NSFW content, infringe on copyright or attempt to impersonate a user.[10]

Hmmm...

34. Promoting or linking to mixer services is prohibited.[11]

No-KYC started as Bitcoin’s default position.  Whereas transactional privacy has had to fight the accomplished fact of Bitcoin’s transparent blockchain, the forces of KYC tyranny have had to fight the starting accomplished fact of no-KYC; however, they had the advantage that KYC was already the accomplished fact of the banking system, and most people are unable to “get” Bitcoin as something beyond, and outside of the banking system.

Ever since the Bitcoin was invented, Bitcoiners have generally thought of no-KYC privacy and mixer services categorically as “legal”.  But insofar as they have really been legal at all, such things have had only a tenuous legality.

Now, together with a tightening noose of law, no-KYC and other privacy services are becoming socially stigmatized.  The existence of this 80-page thread is evidence of that.  If this trend continues, I fear that in the not so far future, outside a privacy ghetto of no-KYC subculture, fewer and fewer people will admit publicly that they consume any no-KYC types of services—even under a pseudonym; those who produce it already try to protect themselves with various forms of strong anonymity.

As they are marginalized, mixer users and other no-KYC people increasingly face negative stereotypes from the mainstream—such as the notion that we’re all drug addicts shopping on Teh Darkwebz or h4x0rz raiding wallets, and generally criminal.

NotATether, I think it’s great that there are no-KYC directories—but I’m concerned that what was once mainstream is increasingly confined to a subculture on the social and economic margins of society.  Even here on this forum, with a famously libertarian administrator who’s ridiculed KYC as an April Fool’s joke, and has made bold declarations against KYC...

⇾ Re: Forum account needs to be KYC
Merited by PowerGlove (4), Xal0lex (3), chimk (2), LoyceV (1), mprep (1), qwk (1), malevolent (1), DireWolfM14 (1), digit (1), botany (1), nullius (1)
I'll get right on that, just as soon as hell freezes over.

...mixer advertising is now banned.  What’s next?

PrivacyG and ABCbits, I have replies to you semi-drafted.  I’ll finish and post them later, in the course of discussion.  Generally preparing to respond to this thread got me sidetracked into reviewing the forum history of these topics—and thus led me to a surprising discovery.

Outer quote is from a restricted forum; the topic cannot be seen by anonymous readers.  Inner quote links will work for anyone.

Without on-chain privacy, every UTXO is an NFT.  It taint right!

Blacklist providers maintain sets of outputs that are blacklisted or tainted in some way, for instance because the owner reported them stolen or because it’s believed they are owned by some criminal enterprise.

If you see this as a good thing, you hate freedom.

[OgNasty]

If Monero had been the first, it would have been immediately attacked and put down.

This is very true.  That is why the Trojan Horse approach is necessary.  All you have to do is look at Namecoin...  It was going to give us immutable access to websites, even being worked on by satoshi himself, and still failed because of restrictions on exchanges and DNS providers.  If Bitcoin wasn't a tool to track transferred coins and instead obfuscated them, the regulators would have never let it get off the ground.

[JollyGood]

Correct me if I am wrong but one of the key points that helped Bitcoin become popular in the very early days was the fact it was decentralised. As for the open ledger, for some reason it did not matter much to early adopters, curious newbies and investors even though every single transaction was visible to the everyone. Instead of deterring people from using Bitcoin (as a lack of privacy issue), it had the opposite effect.

Today mixers are providing the services to obfuscate transactions but had Bitcoin been created with privacy features installed by default, we all know it would never have achieved the position it has today.  

If Monero had been the first, it would have been immediately attacked and put down.

This is very true.  That is why the Trojan Horse approach is necessary.  All you have to do is look at Namecoin...  It was going to give us immutable access to websites, even being worked on by satoshi himself, and still failed because of restrictions on exchanges and DNS providers.  If Bitcoin wasn't a tool to track transferred coins and instead obfuscated them, the regulators would have never let it get off the ground.

[nullius]

If Bitcoin had been a “privacy coin” from the Genesis Block, or even if it had had privacy added around 2013 when some Bitcoin devs were interested in integrating Zerocash edited for precision: Zerocoin/Zerocash, then privacy would be the default expectation.

I tend to disagree with you and agree with LoyceV.  If Monero had been the first, it would have been immediately attacked and put down.

Governments are, on the whole, slow to react to technological changes.  They’re not stupid, as some technophiles like to imagine.  Nor are they monolithic.  It’s just that as few officials understand a new technology, different factions have different agendas, the right hand doesn’t know what the left hand is doing, and much of the public is clueless, any coherent policy is slow to emerge.

It took the USG more than a decade to attack and shut down e-gold (the GS&R gold-backed electronic currency from 1996–2009—not the relatively new, unrelated altcoin), even though that was a totally centralized network with non-anonymous operators who were eventually arrested.  How do you suppose they’d react so fast to attack a P2P network of nerds running software on their own computers?

I infer that the CIA invited Gavin for a little chat in 2011, because the CIA was way ahead of the curve; that’s their job.  But in 2011, what high-level policymakers had even heard of a “bit coin”?  Transparent blockchain or no.  And this is why the accomplished fact of Bitcoin’s initial implementation is so very important.

What do you do about Bitcoin?  As an individual, I sure didn’t know what to do about it!  (And that’s a long, sad story, about which JJG would non-hostilely make fun of me. )

We know what actually happened  But it’s hard for you to predict in retrospect what would’ve happened, if Bitcoin had had privacy from the start.  The precedent of a transparent blockchain changes the viewpoint of regulators about what they will now accept; it also changes your viewpoint about what regulators would have ever accepted.

I’ve been arguing in abstract terms about a fait accompli.  I should make this argument more concrete.

To see my argument more clearly, please apply yours to the following:

• Permissionless.  To interact with the banking system requires asking permission.  If anyone would have invented in 2008 a new form of money, in which you can create new financial accounts just by running some software, then “it would have been immediately attacked and put down.”
• No ability to freeze and seize funds.  If anyone would have invented in 2008 a new form of money, in which judges and police have no peremptory powers to freeze and to seize funds, then “it would have been immediately attacked and put down.”
• Censorship-resistance.  If anyone ever would have invented a financial network where no one can stop drug dealers, terrorists, child pornographers, money launderers, and U.S. sanctioned people from sending and receiving money, then “it would have been immediately attacked and put down.”
• Borderless.  Customs, capital controls, Trump’s tariffs...  Governments love to control, tax, and oppress all kinds of economic activity at their borders!  If anyone ever invented a global form of truly borderless, international money, then “it would have been immediately attacked and put down.”
• Irrevocable transactions.  Authorities love the ability peremptorily to reverse transactions.  Which leads me to...
• Creates ransomware as a new business model for cybercrime.  Yo, Bitcoin created ransomware!  Ransomware literally could not exist without Bitcoin (and cryptocurrencies inspired by Bitcoin).  I vaguely recall perhaps some theorizing which antedated Bitcoin about such a “business model”—but it was impossible in practice, before Bitcoin actually existed.  Thus, if anyone ever invented Bitcoin to lead to the practical invention of ransomware, then “it would have been immediately attacked and put down.”

That list could be continued at length.  I’ll leave it as an exercise to the reader.  Now, what if the following were on the same list?

• Cash-like financial privacy.  I don’t understand why people treat blockchain privacy as if it created some sort of a new bogey.  Zcash and Monero merely provide privacy more or less approximating that of old-fashioned cash.  So, if anyone ever invented cash, which is issued by governments, then “it would have been immediately attacked and put down”?
• Cash-like fungibility, as a consequence of cash-like privacy.  I posit that for a permissionless, decentralized cryptocurrency, cash-like privacy is both necessary and sufficient to attain cash-like fungibility.
  
  Apropos the thread topic, I recall that ChipMixer’s website quoted Adam Back about an English legal precedent that a cash note retains the same fungible value, even if it was stolen and then passed to an innocent party.  Of course, given the privacy of cash, only rarely is it easy to tell that a cash note has passed through criminal transactions.  When you hold a $100 bill in your hand, you don’t know how many drug deals, thefts, etc., etc. it’s been through!

Bitcoin is NOT cash.  Bitcoin’s privacy is such utter shit that from a privacy perspective, I’d rather use a bank account.  No joke.  (I actually first said so in 2017, on the Zcash forum.)  And therefore, Bitoin is NOT FUNGIBLE.  As long as there is even one thread on this forum teaching people how to use “AML checkers”, Bitcoin is a system for trading NFTs by definition.

I will not lie about this, and I’m done making excuses about it.  Without blockchain-layer privacy, Bitcoin is broken by design.

ChipMixer was just trying to make Bitcoin behave a little bit more like cash.  It would be incomparably better to use something that actually behaves like cash, by design—such as Bitcoin with built-in blockchain-layer privacy.

Cypher punks are already a threat to the kind of society we are driving in to.

Mmmm, Cypherpunks...

A specter is haunting the modern world, the specter of crypto anarchy.  [...]  These developments will alter completely the nature of government regulation, the ability to tax and control economic interactions, the ability to keep information secret, and will even alter the nature of trust and reputation.

May first wrote those words about 38 years ago—in a small-circulation draft, which was widely published about 34 years ago.  When will we learn?

Although, as I think about it, I remember the other argument I often pull out of my deck which is very conflicting with the exact arguments I wrote above.  That is, I am also of the opinion that Monero can not be put down because the same people who want it put down are the ones who need it the most.  Because in a future society where hiding any thing is crime, they need to pretend full transparency but they would also be the first rules do not apply for.

^^^ This, too.  Funny how this part is ignored by everyone who wants a transparent blockchain.

If Monero had been the first, it would have been immediately attacked and put down.

This is very true.  That is why the Trojan Horse approach is necessary.

Your argument is the Trojan Horse.  You’re actively anti-mixer, you have been for years, and to push your agenda, you’ve bluntly cherry-picked one sentence from the context of a long, nuanced post.

Though for the sake of forum peace and unity, it’s nice to see that OgNasty has joined the LoyceV gang—or perhaps now that he no longer wears a paid ChipMixer signature, LoyceV is now buying a seat in NastyFans? 

More context:

I tend to disagree with you and agree with LoyceV.  If Monero had been the first, it would have been immediately attacked and put down.

No offense intended to PrivacyG.  The purpose of my sarcasm is not to criticize ad hominem an argument that agrees with LoyceV, but to observe that OgNasty loudly snipped that part.


Well, what is your agenda here?

If it's a bigger issue then the forum's administration could step in and ban advertisements from chipmixer.  Given their guise of privacy argument and the members on their payroll, I seriously doubt we'll see that happen.

By the way, this is personally despicable, reprehensible beyond the pale in the context of the thread where you posted it:

I guess I didn't leave out any context then.  I rigorously proved that o_e_l_e_o was knowingly lying about open source privacy projects and convincing users to give up custody of their funds and data to ChipMixer, who scammed their depositors.

I haven’t followed this issue much, outside of warning everyone right BEFORE chipmixer was shut down that they shouldn’t use it because the site had illegally laundered money for a criminal theft and would obviously be shut down as a result. I was attacked for that warning that turned out to be true. You’d think I would have been praised in a normal environment…

You have also attacked mixers with broad-brush ad hominem arguments that are simply false:

Bold added:

Just highlighting this as it is like clockwork that the only people who defend these mixers are on their payroll.

Why I am temporarily wearing an unpaid, unsolicited Chipmixer signature ad
Merited by squatz1 (10), Foxpup (6), BlackHatCoiner (6), DarkStar_ (5), malevolent (4), hugeblack (2), nc50lc (2), 1miau (2), o_e_l_e_o (2), marlboroza (2), Heisenberg_Hunter (2), stompix (1), buwaytress (1), mk4 (1), NotATether (1)

In various forms, my signature promoted unpaid links to ChipMixer’s clearnet and onion sites for most of the year 2020.  I also considered applying to their paid signature campaign; it would have been fair to myself!  In retrospect, I question if avoiding the paid campaign was foolish of me.

Ethical disclosure:  Having learned my lesson about such foolishness, I now accept payment to advertise no-KYC exchanges.  I’d promote no-KYC exchanges anyway, on principle.  To promote no-KYC exchanges is to express my political opinions.  And I’ve been using noncustodial no-KYC coin swaps myself, since not later than 2017; a fun fact that theymos could probably verify on the BTC side:  I paid for my Bitcoin Forum u=976210 “evil IP” (Tor exit) registration fee/Copper Membership directly with a swap of shielded ZEC→BTC on the old, no-KYC version of Shapeshift.  I’d promote no-KYC exchanges for free!  So, why shouldn’t I get paid?  To make myself oh so nobly poor, while only other people make money?  That’s bullshit.  Did I take an ascetic’s vow of poverty when I joined this money-forum!?  I never wore a paid signature of any kind whatsoever before 23 October 2026, and I never received any financial compensation of any kind from ChipMixer—much to my now regret; lol, that was fucking stupid of me.

All you have to do is look at Namecoin...  It was going to give us immutable access to websites, even being worked on by satoshi himself, and still failed because of restrictions on exchanges and DNS providers.

There, you simply show your ignorance of how DNS works.

Namecoin failed due to insufficient market demand to overcome its barrier to entry—or, depeding on your perspective, too high a barrier to entry for its poor market demand.  Anyone could, and still can permissionlessly configure their own DNS lookups to include Namecoin; almost no one does so.  The Namecoin token has always been available, and I’ve never heard of any special exchange restrictions on it—nothing like CEX censorship of Monero.

In my opinion, Namecoin’s biggest problem is that for anti-censorship purposes, it’s competing with the IETF standardized^* .onion domain.  Namecoin attempts to “square Zooko’s triangle”.  .onion provides only “secure” and “decentralized” without attempting “human-readable”—but it has the advantage of being built into an overlay network with other benefits; moreover, .onion is free-as-in-beer as well as being free-as-in-speech.  By the trade-offs involved, the market has thus far chosen .onion over every attempt to square Zooko’s triangle.

An interesting coincidence here:  “Zooko” refers to Zooko Wilcox, an OG cypherpunk who worked on the first cryptocurrency, DigiCash, in 1996, and who led the launch of Zcash twenty years later in 2016.

^* To be clear, .onion was invented long before Namecoin, but IETF-standardized after it.

If Bitcoin wasn't a tool to track transferred coins and instead obfuscated them, the regulators would have never let it get off the ground.

If Bitcoin was a tool for creating unfreezable, uncensorable “numbered bank accounts” with a few elliptic curve point operations, with no permission and no KYC, the regulators would have never let it get off the ground.

This argument is sheer nonsense.

ABCbits, my reply to you is now split off for later.  Sorry.

[joker_josue]

We know what actually happened  But it’s hard for you to predict in retrospect what would’ve happened, if Bitcoin had had privacy from the start.  The precedent of a transparent blockchain changes the viewpoint of regulators about what they will now accept; it also changes your viewpoint about what regulators would have ever accepted.

But Bitcoin has always had privacy from the start. It all depends on how the user uses it.

If it didn't have privacy, criminals and hackers wouldn't use it. That's why you say ransomware is only possible thanks to Bitcoin.

Now, it's up to people to use Bitcoin correctly in order to guarantee this privacy.

This issue was debated 15 years ago, and Satoshi himself highlighted that it would be the way it was used and additional solutions that should bring some extra privacy.

It's true that blockchain analytics companies can identify who owns bitcoin. But the fault lies not with bitcoin itself, but with the links that users end up leaving behind.

[examplens]

Ever since the 1960s, people in Western democracies, at least, have generally thought of porn as “legal”.  Its status varies wildly by jurisdiction; for the purposes of this Meta thread, with apologies to non-USAians, I will focus on this forum’s legal jurisdiction, the United States.  In the U.S., sexual speech has only had a tenuous legality; it is not accorded the same status and constitutional protection as, say, speech advocating the election of a Democrat or a Republican.  The things variously called “porn” have thus been subject to regulations, prior restraints, legal risks in practice, and lesser First Amendment protections.

When you already brought porn and analogy into the discussion, shouldn't advertising porn be treated under the rule of the "Reiteration of ban on "dark" sites", and have the same conditions as for the mixers? The porn industry also balances on the edge between legal and illegal and is very present on the dark web.
I don't know how far the regulation of porn goes in the US jurisdiction, but after all, it would be quite bizarre if the forum bears the consequences because of porn ads.

[nullius]

But Bitcoin has always had privacy from the start. It all depends on how the user uses it.

For on-chain “privacy”, Bitcoin offers you a substantial choice of:

• CoinJoin, which AML-taints your coins, which is for “power users” only, which wastes transaction fees, which constrains you to the UTXO amounts of your join partners, which has so many footguns that I doubt many people really use it properly in practice, and which in the best case can offer only mediocre privacy.
• Centralized mixers, which AML-taint your coins, which are trust-based—and which are now banned from advertising on this forum, so that only advanced users even know where to find them.

If it [Bitcoin] didn't have privacy, criminals and hackers wouldn't use it.

Many criminals and hackers got caught by blockchain analytics, even those who have high expertise.  Often, they get caught by a mistake made after years of getting away with it—e.g., this forum’s own Loaded, a hacker who stole money from a drug dealer.  I could give many other examples.

Now, please don’t shrug that off as, “Eh, it’s good that ‘criminals’ get caught.”  Think of this objectively:  If smart people whose personal safety and survival depends on Bitcoin privacy can’t get it right, don’t fool yourself that you can.

That's why you say ransomware is only possible thanks to Bitcoin.

And then, they need high-cost, high-risk money laundering.  I said it’s possible.

In this context, I should also point out that privacy is necessary to stop criminals just as much as criminals themselves need privacy.


N.b., I am not saying anything new for me.  Here are some of my earliest “Newbie” rank posts on the Bitcoin Forum; I started with this almost immediately after my first post on December 1, 2017:

Bitcoin was never anonymous.  Anybody who said it is, was stupid or lying.

Bitcoin is anonymous,

[...]

Bitcoin has been created to be anonymous,

STOP MISLEADING PEOPLE.  Bitcoin was never anonymous, not designed to be, and never imagined to be by anybody who understands the simple concept of a global public ledger.

In the Twitter/TL;DR world, so few people actually read nowadays.  Who needs it?  Let’s see a picture of how pretty a Bitcoin transaction graph is!

[...]

It is nice to see a Newbie's fight! Lmao

I may perhaps consider your opinion and explain to you why you’re wrong, if you could explain to me how many “newbies” have longstanding familiarity with the academic literature on Bitcoin transaction tracing.

Some of my earliest merits—sent by people who remembered this post and returned to it, after the merit system was created on January 24, 2018:

Merited by johhnyUA (1), marlboroza (1)

I guess they could identify you only once you cashed out. Other than that, your identity is safe (unless you have verified your identify in an online wallet, of course);

WRONG.  For but one of a hundred other ways your identities could be linked, even if you mix with CoinJoin, check out this pretty picture from a research paper I referenced in my earlier post on this thread:

[Image removed: “The following error or errors occurred while posting this message: Embedding imgur links is not supported in new posts”]

Stop giving dangerously bad advice!

The only way I’m changing my tune here is to stop talking out of both sides of my mouth to make excuses for Bitcoin.

BTC has no long-term value.  If I can go to sleep in a world where mixers are normal and I don’t know how to do an “AML check”, wake up four years later, and discover that mixer ads are banned and “AML checkers” are a Bitcoin user skill, then the long-term hold value of a Bitcoin UTXO in my wallet is zero to me:  For I have no guarantee that I’ll be able to use it in the future—not at all, let alone to get the same price for it as banks, billionaires, and ETFs trade it for on CEXes.  It’s an NFT that I may need to trade at a discount on the graymarket, or that may become totally useless to me.  Worse, it’s a trap:  What if I become desperate to recover value from it—desperate in the “I need food and medical care” sense (a plausible, realistic life emergency scenario)—and the only future way to recover value from BTC is to sell my privacy to KYC?

I want for Bitcoin to have privacy.  It doesn’t, I am fighting for it, and I will not lie about that.  Moreover...

“Taint”, “AML checks”, and “risk scores” are cancer.  This is chemotherapy.

Chemotherapy is painful.

Make no mistake:  I am not attacking Bitcoin.  “Taint”, “AML checks”, and “risk scores” have successfully attacked Bitcoin.  Government pressure on mixers has successfully attacked Bitcoin, to the degree that the Bitcoin Forum has banned mixer ads.  I am acknowledging the reality, and fighting back.


A note on the legality of porn

Ever since the 1960s, people in Western democracies, at least, have generally thought of porn as “legal”.  [...]

When you already brought porn and analogy into the discussion, shouldn't advertising porn be treated under the rule of the "Reiteration of ban on "dark" sites", and have the same conditions as for the mixers?

Absolutely not.  The “mainstream” porn industry, at least, is operated by non-anonymous companies under onerous regulations—including, but not limited to 18 U.S.C. § 2257, which KYCs all performers in records available to the police on-demand.

Please don’t mistake what I said to FUD the porn industry:  Their legal status is precarious (or “tenuous” as I said), and they are heavily burdened by the U.S. legal system, but they are not illegal.  What they lack is this:

In the U.S., sexual speech has only had a tenuous legality; it is not accorded the same status and constitutional protection as, say, speech advocating the election of a Democrat or a Republican.

And their status is precarious—perpetually under political attack, with many enemies and few friends.  It makes them the canary in the free speech coal mine.

The porn industry also balances on the edge between legal and illegal and is very present on the dark web.

The “mainstream” porn industry has zero presence on the “dark web”.

I don't know how far the regulation of porn goes in the US jurisdiction, but after all, it would be quite bizarre if the forum bears the consequences because of porn ads.

For information about this, please see the Free Speech Coalition, a 501(c)(6) U.S. porn industry trade group that’s armed to the teeth with American lawyers.  They’ve done substantial litigation over the legality of porn, and the constitutionality of porn regulations—including a U.S. Supreme Court case they bought against the whole KYC-for-porn-consumers concept; they lost that case last year, despite being represented by the ACLU in the public interest.