Dirty coins

[R2D221]

Even without a mixing service, there is no way to prevent somebody from sending you tainted coins.

Yes, this is also an important point.

Just picture the following scenario:

—Hey, I want to pay you
—No way, your coins are related to the recent hack!
—I already sent them to your address. U MAD BRO?

It might be ridiculous, but it's totally possible. What will you do then, now that you yourself are tainted too?

[1714018616]

1714018616

[1714018616]

1714018616

[Borisz]

Even without a mixing service, there is no way to prevent somebody from sending you tainted coins.

Yes, this is also an important point.

Just picture the following scenario:

—Hey, I want to pay you
—No way, your coins are related to the recent hack!
—I already sent them to your address. U MAD BRO?

It might be ridiculous, but it's totally possible. What will you do then, now that you yourself are tainted too?

WoW, nice. I mean evil.
Just send a few coins to some reputable exchanges/services and done.
Pure evil.

[aantonopoulis]

Even without a mixing service, there is no way to prevent somebody from sending you tainted coins.

Yes, this is also an important point.

Just picture the following scenario:

—Hey, I want to pay you
—No way, your coins are related to the recent hack!
—I already sent them to your address. U MAD BRO?

It might be ridiculous, but it's totally possible. What will you do then, now that you yourself are tainted too?

WoW, nice. I mean evil.
Just send a few coins to some reputable exchanges/services and done.
Pure evil.

Not entirely true, as that unspent output need never be touched.  I can move my other coins which I had in this address to another which is now clean, without touching the dirty dust that you sent me. 

[R2D221]

Even without a mixing service, there is no way to prevent somebody from sending you tainted coins.

Yes, this is also an important point.

Just picture the following scenario:

—Hey, I want to pay you
—No way, your coins are related to the recent hack!
—I already sent them to your address. U MAD BRO?

It might be ridiculous, but it's totally possible. What will you do then, now that you yourself are tainted too?

WoW, nice. I mean evil.
Just send a few coins to some reputable exchanges/services and done.
Pure evil.

Not entirely true, as that unspent output need never be touched.  I can move my other coins which I had in this address to another which is now clean, without touching the dirty dust that you sent me. 

It's not necessarily dust. Also, I thought we were marking addresses and not individual outputs.

[DieJohnny]

If you say you don't care, then I think you are not being a responsible member of society. You should care and you it is easy to check, so why not do it.

No, it's not. After the thief uses a coin mixing service, there's no way to tell where those coins come from.

I didn't say he used a mixing service.

[DieJohnny]

Even without a mixing service, there is no way to prevent somebody from sending you tainted coins.

Yes, this is also an important point.

Just picture the following scenario:

—Hey, I want to pay you
—No way, your coins are related to the recent hack!
—I already sent them to your address. U MAD BRO?

It might be ridiculous, but it's totally possible. What will you do then, now that you yourself are tainted too?

This is a great scenario because if you had my little app you could let bitstamp know you confiscated some of their coins and will be returning them immediately!! great example

[R2D221]

If you say you don't care, then I think you are not being a responsible member of society. You should care and you it is easy to check, so why not do it.

No, it's not. After the thief uses a coin mixing service, there's no way to tell where those coins come from.

I didn't say he used a mixing service.

But I say he does. We need to take into account all scenarios.

[R2D221]

Even without a mixing service, there is no way to prevent somebody from sending you tainted coins.

Yes, this is also an important point.

Just picture the following scenario:

—Hey, I want to pay you
—No way, your coins are related to the recent hack!
—I already sent them to your address. U MAD BRO?

It might be ridiculous, but it's totally possible. What will you do then, now that you yourself are tainted too?

This is a great scenario because if you had my little app you could let bitstamp know you confiscated some of their coins and will be returning them immediately!! great example

WHAT?

[amspir]

Would you want to know if those 7000 coins were coming from the addresses that are part of the BTER heist before you made the purchase or not???

If you say you don't care, then I think you are not being a responsible member of society. You should care and you it is easy to check, so why not do it.

I spend cash money at the grocery store all the time.   Never have they asked for the source of the cash, nor my identity, for buying groceries.     

Legally in the USA, you are not required to report a cash transaction to the government unless it exceeds $10,000.

[DieJohnny]

If you say you don't care, then I think you are not being a responsible member of society. You should care and you it is easy to check, so why not do it.

No, it's not. After the thief uses a coin mixing service, there's no way to tell where those coins come from.

I didn't say he used a mixing service.

But I say he does. We need to take into account all scenarios.

So in your scenario my app to check address history wouldn't be useful because of the mixer. Yep great.

[R2D221]

If you say you don't care, then I think you are not being a responsible member of society. You should care and you it is easy to check, so why not do it.

No, it's not. After the thief uses a coin mixing service, there's no way to tell where those coins come from.

I didn't say he used a mixing service.

But I say he does. We need to take into account all scenarios.

So in your scenario my app to check address history wouldn't be useful because of the mixer. Yep great.

You seem to disregard this reason, when it's actually one of the strongest. Do you actually understand how mixers work?

[DieJohnny]

If you say you don't care, then I think you are not being a responsible member of society. You should care and you it is easy to check, so why not do it.

No, it's not. After the thief uses a coin mixing service, there's no way to tell where those coins come from.

I didn't say he used a mixing service.

But I say he does. We need to take into account all scenarios.

So in your scenario my app to check address history wouldn't be useful because of the mixer. Yep great.

You seem to disregard this reason, when it's actually one of the strongest. Do you actually understand how mixers work?

I am not disregarding your reason, it is valid. But me rejecting an unmixed coin is just as valid.

I just read this article about a billioinaire says "So if someone offers you one of two bitcoin, you should choose the one that has never been attached to Silk Road or that has some dubious history."

http://venturebeat.com/2015/02/16/heres-why-bitcoin-will-be-bigger-than-the-internet/

I think my little app that tells me how dirty your address is would be pretty useful, more confident than ever.

EDIT: seems billionaire didn't say the above

[R2D221]

I am not disregarding your reason, it is valid. But me rejecting an unmixed coin is just as valid.

For your solution to work, it must be able to work in all scenarios. I just showed an scenario where it's invalid. That scenario is enough to prove the failure of coin filtering, because then all criminals will mix their coins and circumvent your system entirely. And surely they are already doing this.

[bitkilo]

I have often thought about so called 'dirty coins' and what happens once they are tagged with 'bitstamp hack' or similar.
What may be considered a dirty coin to one person may not be dirty to the next.

Person A may consider any coin that has been passed though a porn site a 'dirty coin', where as i would not.
Person B may be happy to accept any coins from porn or silk road but won't take coins marked 'hacked'.
Person C may only want clean coins, not possible in the long run just like cash.

I am not fully aware of how mixing services work so if someone could explain or link me to a site that explains this it would be a big help.

[DieJohnny]

I am not disregarding your reason, it is valid. But me rejecting an unmixed coin is just as valid.

For your solution to work, it must be able to work in all scenarios. I just showed an scenario where it's invalid. That scenario is enough to prove the failure of coin filtering, because then all criminals will mix their coins and circumvent your system entirely. And surely they are already doing this.

Uhh no you would be completely wrong. I only need one scenario where it is useful. You have it backwards.

[R2D221]

I am not fully aware of how mixing services work so if someone could explain or link me to a site that explains this it would be a big help.

Either you merge your coins with others in a single output and then split it differently, or use a reserve of unrelated outputs to redistribute them.

This comes from BitMixer's page:

[R2D221]

Uhh no you would be completely wrong. I only need one scenario where it is useful. You have it backwards.

If I'm a criminal and I find a flaw in the legal system, do you think I would still go the obvious way and get caught? Once there's a flaw, everyone will start to use it and the system is just a big curtain. Unless the flaw can be fixed (and there's no way to “fix” coin mixing as far as I'm aware), then all effort is futile.

[bitkilo]

I am not fully aware of how mixing services work so if someone could explain or link me to a site that explains this it would be a big help.

Either you merge your coins with others in a single output and then split it differently, or use a reserve of unrelated outputs to redistribute them.

Thanks for the link, it confirmed the basic knowledge i already had of coin mixing, i will look into this further when not at work.
1 question, if the coins going into the mixing service are already marked won't they have to pass on the coins in the future?
Just say i want to mix my non marked coins for whatever reason then get back coins marked 'bitstamp hack' or similar i would not be very happy.
 

[DieJohnny]

Uhh no you would be completely wrong. I only need one scenario where it is useful. You have it backwards.

If I'm a criminal and I find a flaw in the legal system, do you think I would still go the obvious way and get caught? Once there's a flaw, everyone will start to use it and the system is just a big curtain. Unless the flaw can be fixed (and there's no way to “fix” coin mixing as far as I'm aware), then all effort is futile.

I didn't say what i want is a solution, it is simply a way to do some basic due dilligence.

[Borisz]

Even without a mixing service, there is no way to prevent somebody from sending you tainted coins.

Yes, this is also an important point.

Just picture the following scenario:

—Hey, I want to pay you
—No way, your coins are related to the recent hack!
—I already sent them to your address. U MAD BRO?

It might be ridiculous, but it's totally possible. What will you do then, now that you yourself are tainted too?

WoW, nice. I mean evil.
Just send a few coins to some reputable exchanges/services and done.
Pure evil.

Not entirely true, as that unspent output need never be touched.  I can move my other coins which I had in this address to another which is now clean, without touching the dirty dust that you sent me. 

If I send it to a cold wallet address of an exchange where another 7000 BTC are stored, is it still simple to sort it out?

Of course, if received to a fresh address it as manageable.