Topic: 2012-12-18 CNN.com Bitcoin looks primed for money laundering (Read 6549 times)

Bitcoin cannot "launder" money because it is money.

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If you dig Bitcoin you are smarter than average....

I saw mention from Gavin (https://bitcoinfoundation.org/blog/?p=135) that some transactions in the past week have taken extra long to confirm due to the network transaction volume sometimes exceeding the 250kB/block size limit, so this may have added some delay to your scheme. I try to minimize my logging, so I can't tell exactly, but it looks like your tx took about 2.5 hours to reach 10 confirmations.

All good?

Peace,
Mike

The funny part is no bitcoin service has ever been charged with money laundering. If bitcoin was a company it could sue cnn for slander 

The funny part is no bitcoin service has ever been charged with money laundering.

Dear Mike,

I'm glad I was able to find you on this site.  I've been having problems with your applications.

Firstly, I made a 1 BTC transaction on your bitcoinlaundry.com site.  The fees were deducted, but I was simply relayed the BTC with no hops for obfuscation.  I don't mind making a donation to you on a 1 BTC transfer, but the site provided no utility.

Secondly, I tried a 1.42 BTC transaction on your app.bitlaundry.com application.  I sent it to two addresses, with one transaction per day, and a 1-day timeframe.  Therefore, under your site's calculus, I should have incurred a fee of approximately (1.42 BTC*.0249)+2 outgoing transactions * (.009 BTC) = ~0.05BTC, and I should have received the balance at the two addresses provided.

Instead, it has been 24 hours and I have yet to receive a notification of a pending transfer to either address, let alone any confirmations.  

Please see this image, which serves as proof that I sent the 1.42 BTC to the temporary address you provided, and that you have already transferred the money out from that address as well.

I know that you have a positive reputation and a posting history on this site, so I hope that you can help me rectify this situation.  If you would prefer to do so via PM or email instead of a public forum, feel free to PM me a response, or shoot me an email.

Thanks much,
q6

Yeh! You should tweet that to him

I guess he was assigned the task by a supervisor which basically said: Hear, this bitcoin stuff, our owners don't like it, write some negative piece on it.

Here is me pretty much bashing the author on twitter https://twitter.com/csanati/status/281850206838996992

@CharlieShrem @sebicas Lies? I am not in the disinformation business. If I made a mistake, please be specific. I spent days researching

A crash last summer ?  Is it about this fast varation in the price, wich corrected quite fast, like a failed pump and dump from a scammer named Pi__40 ?

Not a crash, just a scammer dump, over a few weeks period, it does'nt affect the BTC ratio to USD.

Tell me where to buy oil for bitcoins, and I will put all my savings in BTC before thay skyrocket over $30 again.

Bitcoins can bought in almost any mayor currency

What a mess of FUD. Key points of the article are just wrong.

1. Bitcoin is not suitable for large-scale money laundering. All transactions are stored permanently in a distributed public ledger. If it is possible to identify some reciever and trace back recievements of payments, authors of illegal activities could be found.

2. The exchange rate has still some significant volatility, but it is clearly decreasing. If an online vendor receives bitcoins for payments and converts them on the spot, the exchange rate risk is very low for him. If you account for that risk and compare it to fees for credit card processing and the risk of charebacks, it is much cheaper. There are services which do automatic conversions for online services and merchants. And these are used by NGOs and companies like WordPress.

3. Much more interesting than for money laundering is bitcoin for money transfers of migrant workers. Bitcoins can bought in almost any mayor currency of the G8+5 countries. Via services like localbitcoin.com, they can be sold in virtually any place in the world. They are ideally suited for workers form developing countries to send modest amounts of money home, much cheaper than with Western Union and the like.

4. Bitcoins have been a risky but profitable investment in the past. The exchange rate is increasing in the long run, and there is no special reason why it should not continue to do. Now, as the rapid growth of exchange rates had some slowdown, it is still quite profitable (as well as still risky). Of course, there is the danger of new bubbles... but we've seen that in the long run, the value returns.

5. The article makes a key point in the assumption that bitcoin is used predominantly for illicit trade and fails completely at proving that. The well-informed reader will know that the percentage of the shadow and informal earnings at the GDP will be usually 7 % or much higher. A significant part of this is transacted in cash. The article does not bring any proof whether bitcoins is used more for that than conventional payment methods.

6. On giving up being defensive, I think there is a area in which decentral currencies like Bitcoin could bring significant improvements for mankind: They will make it more difficult to finance war. Traditionally, war has been financed by governments stealthily printing money and raising uncovered debts, undermining stability of national currencies in one or another form. Wars have been the main causes of mayor inflations, robbing many millions of people from their savings and the result of their life's work.

7. And I have a last objection: The article arrogates that money transfers by Iranian people are per se illegitimate. I beg to differ. While I am very far away from excusing or tolerating any tyrrany or arms-trafficking, I think that people in Iran have the right to eat something, to save something and to protect their property like any human being on earth. It would be an excess of hypocrisy to cry about the death of a beautiful young human like Neda Agha-Soltan, and to deny their fellow Iranians the right to eat something. Bitcoin originates from the culture of the internet, and that is a very different culture - we understand more and more that all of us are human beings, and all of us have the same right to live.