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Topic: A Warning Against Using Taint - page 3. (Read 16331 times)

hero member
Activity: 686
Merit: 500
Wat
June 07, 2012, 07:27:44 PM
Mt Gox has recently blocked peoples access to coins then forced them through onerous ID requirements claiming they came from the bitcoinica hack. You can bet the major exchanges have "blacklists" only know one before they deposit whether they are on this.


If such a thing exists I would like to know beforehand rather than risk having to deal with a  goxing because i unknowingly received tainted coins. Cheesy

I guess that means MtGox is already using taint.  Are they really?  How did you find out?

I read the forums Smiley

imho people should boycott mt gox for such things.
sr. member
Activity: 444
Merit: 250
I prefer evolution to revolution.
June 07, 2012, 06:50:09 PM
Mt Gox has recently blocked peoples access to coins then forced them through onerous ID requirements claiming they came from the bitcoinica hack. You can bet the major exchanges have "blacklists" only know one before they deposit whether they are on this.


If such a thing exists I would like to know beforehand rather than risk having to deal with a  goxing because i unknowingly received tainted coins. Cheesy

I guess that means MtGox is already using taint.  Are they really?  How did you find out?
sr. member
Activity: 444
Merit: 250
I prefer evolution to revolution.
June 07, 2012, 06:24:01 PM
The problem is that the people who respond with violence are not bad actors, they are honest people who have had their money taken without compensation based on nothing more than the belief that the money might have been involved in an illegal transaction at some point in its history. Remember, YOU CANNOT CONTROL WHO SENDS YOU BITCOINS!
Do you mean that the money in my wallet that is tainted is somehow "taken" from me because I can't use it to buy something from... someone... somewhere who sees the taint?  There are plenty of other people to transact with, no?  Remember, it's a personal blacklist.  Most of the people on this thread here have insinuated that they would ignore any taint.

This reminds me of an assumption I made while I was growing up without realizing it, which is a really stupid assumption:  That prices should be the same for everyone.  That's just BS.  If I like you, you'll get a better price.  If I don't like anybody, then my price to all of them will be higher, and I won't get to trade much.  The same thing goes for this taint idea.

The biggest problem I see is lack of original judgment.  Too many people just do what they're told - they're sheeple.  Because of that, the mere suggestion that address XYZ belongs to a thief can ruin the owner of that address.  But I don't think that would happen much, because the average BTC user is a bit brighter than that, and the "mere suggestion" will get the suggester a large load of chastisement for jumping to conclusions.  Or maybe I'm wrong.  Again, it's a faith in the community that perhaps I have too much of, at least as pertains to the exposure of transactions from alleged thieves.
sr. member
Activity: 444
Merit: 250
I prefer evolution to revolution.
June 07, 2012, 06:02:07 PM
And you have to convince people to use it, and to use it properly, and to maintain their blacklists on their own (you're not looking to centralize a list, are you?)
Absolutely not!  I don't even think any of the other things are necessary.  It's like puling the curtain back so people can see the old man.  They are free to ignore him and continue kneeling before the "wizard".  I think if the ONLY effort is pulling back the curtain, the net effect will be positive.  But I respect the consensus that it won't be positive, so I'm agreeing to disagree, and participating in this discussion now only to point things out that I think are important.
legendary
Activity: 980
Merit: 1004
Firstbits: Compromised. Thanks, Android!
June 07, 2012, 02:42:22 PM
Well, that's the problem, but apparently the solution is, to use the blockchain to declare unclean ALL other coins that may have ever directly or indirectly touched the "tainted" ones, no matter how much tracing back has to be done.
Afaik, a typical bitcoin laundry service works like this:



You transfer N bitcoins from address A to P.
They Someone transfers X bitcoins from address Q to B, and Y bitcoins from R to C (where X+Y ≈ N minus a random fee of ±2%).
No money is transferred between A and B, A and C, P and Q, P and R, or Q and R.

Can the coins at Q or R now be considered dirty?

(the ones at P are eventually cashed out at MtGox)

Yes, that's how to try to get around it, but once Mt. Gox starts "rejecting" (read: keeping for themselves) the coins at P because someone some time ago back said a transaction was a theft, how long can such a service remain viable? Why would they give you coins from Q and R when they know they can't use the coins at P?

True, the coins at P could be split to several addresses which are passed around on paper via private keys (similar to Casascius coins.) But if those coins can't be spent on the blockchain, and instead they require that one private key to be constantly passed around yet kept secret, that doesn't seem like a workable plan either.

Once someone chooses to believe in "tainted" coins (just like believing in "dirty money",) they'll be set on trying to "reject" any transactions even tangentially related. The best approach to dealing with this and avoiding having innocent people be defrauded and stolen from is to just ignore their belief and refuse to use code or services that implement their schemes.
hero member
Activity: 609
Merit: 500
June 07, 2012, 12:16:03 PM
#99
I'm 6 pages in before my reply, but here's my thinking:
 
I don't support this at all, because I view bitcoins as cash.  Let's say you sell something for $100 on craigslist, and you get a nice $100 bill, you try the ink mark and determine it's a legit $100.  You go into the bank to deposit it and they say, "this $100 was stolen last month, we have its serial number written down.  You cannot use this $100 anymore"
 
I call bullshit.  It's my money, I got it through legal means.  It sucks to the person who had it stolen, but I'll be damned if I'm going to give up my money (government stealing notwithstanding).
legendary
Activity: 1176
Merit: 1011
June 07, 2012, 11:17:05 AM
#98
Well, that's the problem, but apparently the solution is, to use the blockchain to declare unclean ALL other coins that may have ever directly or indirectly touched the "tainted" ones, no matter how much tracing back has to be done.
Afaik, a typical bitcoin laundry service works like this:



You transfer N bitcoins from address A to P.
They Someone transfers X bitcoins from address Q to B, and Y bitcoins from R to C (where X+Y ≈ N minus a random fee of ±2%).
No money is transferred between A and B, A and C, P and Q, P and R, or Q and R.

Can the coins at Q or R now be considered dirty?

(the ones at P are eventually cashed out at MtGox)
legendary
Activity: 980
Merit: 1004
Firstbits: Compromised. Thanks, Android!
June 07, 2012, 10:07:14 AM
#97
You can follow the trail of a coin. Just say a bitcoin was stolen from bitcoinica you can see in the blockchain which address it goes too and how many transactions have happened in between.
A stolen bitcoin.

Like someone steal a bitcoin, well then this bitcoin is "tainted" and whoever receive it will like be "omg you have a tainted bitcoin you CRIMINAL" wich of course make no sense cause bitcoins keep moving from an address to another and if you sell something to someone and he pay you with a "tainted coin" you are not a criminal.
I see, thanks.

Doesn't seem like a working concept to me. If somebody steals bitcoins (by hacking someone's mtgox account or whatever, and transferring bitcoins stored online to an address of his own) he can simply mix them up with other bitcoins, send them through a few transactions combined with other addresses, or use one of the dozen bitcoin laundry schemes or services, and there's no telling which bitcoins are tainted anymore.

Well, that's the problem, but apparently the solution is, to use the blockchain to declare unclean ALL other coins that may have ever directly or indirectly touched the "tainted" ones, no matter how much tracing back has to be done.

You would think the unworkability of this would be obvious, yet here we are, having to point this out to people who want to reject your money because it's evil. (And by "reject," they either mean keep or naively hand over to someone else, since they seem to know full well that a payment can't really be rejected, even though they keep using the word.)
legendary
Activity: 1078
Merit: 1003
June 07, 2012, 09:48:00 AM
#96
Tainting will likely happen after/when Bitcoin is widespread, I would give it 12-15 years.
Sorry if this is a stupid question (couldn't find a non-ambiguous answer anywhere) but exactly what is a tainted bitcoin?



A stolen bitcoin.

Like someone steal a bitcoin, well then this bitcoin is "tainted" and whoever receive it will like be "omg you have a tainted bitcoin you CRIMINAL" wich of course make no sense cause bitcoins keep moving from an address to another and if you sell something to someone and he pay you with a "tainted coin" you are not a criminal.

Not true. Tainted is not a stolen bitcoin, it's a bitcoin merely accused of being stolen, big fking difference.
legendary
Activity: 1176
Merit: 1011
June 07, 2012, 09:42:56 AM
#95
You can follow the trail of a coin. Just say a bitcoin was stolen from bitcoinica you can see in the blockchain which address it goes too and how many transactions have happened in between.
A stolen bitcoin.

Like someone steal a bitcoin, well then this bitcoin is "tainted" and whoever receive it will like be "omg you have a tainted bitcoin you CRIMINAL" wich of course make no sense cause bitcoins keep moving from an address to another and if you sell something to someone and he pay you with a "tainted coin" you are not a criminal.
I see, thanks.

Doesn't seem like a working concept to me. If somebody steals bitcoins (by hacking someone's mtgox account or whatever, and transferring bitcoins stored online to an address of his own) he can simply mix them up with other bitcoins, send them through a few transactions combined with other addresses, or use one of the dozen bitcoin laundry schemes or services, and there's no telling which bitcoins are tainted anymore.
legendary
Activity: 1148
Merit: 1008
If you want to walk on water, get out of the boat
June 07, 2012, 08:29:52 AM
#94
Tainting will likely happen after/when Bitcoin is widespread, I would give it 12-15 years.
Sorry if this is a stupid question (couldn't find a non-ambiguous answer anywhere) but exactly what is a tainted bitcoin?



A stolen bitcoin.

Like someone steal a bitcoin, well then this bitcoin is "tainted" and whoever receive it will like be "omg you have a tainted bitcoin you CRIMINAL" wich of course make no sense cause bitcoins keep moving from an address to another and if you sell something to someone and he pay you with a "tainted coin" you are not a criminal.
donator
Activity: 1218
Merit: 1079
Gerald Davis
June 07, 2012, 07:55:53 AM
#93
If however, the control-points  are things like supermarkets which have captive local consumers - it's unfortunately not going to be enough to stop it.

No customers will just use cash or some other system which retains fungibility.  The customer will just ignore worthless Bitcoin and all the complications which produce no value and undermine the system.  That is the whole point.  Once Bitcoin loses fungibility is ceases to have any value as a medium of exchange.

"Here is this new medium of exchange which just happens to suck royally as a medium of exchange.  Please stop using your existing highly fungible payment systems and adopt this one instead"

Quote
Anyway.. the likely implementation would be that the merchant accepts them, but applies the prescribed tax and asks for a further small payment before you walk out of the store.

At which point:
a) Bitcoin loses a user likely forever
b) The store loses a customer possibly forever
c) A class action lawsuit lawyer gains a lucrative plaintiff.
hero member
Activity: 686
Merit: 500
Wat
June 07, 2012, 07:13:53 AM
#92
Tainting will likely happen after/when Bitcoin is widespread, I would give it 12-15 years.
Sorry if this is a stupid question (couldn't find a non-ambiguous answer anywhere) but exactly what is a tainted bitcoin?



You can follow the trail of a coin. Just say a bitcoin was stolen from bitcoinica you can see in the blockchain which address it goes too and how many transactions have happened in between.
legendary
Activity: 1176
Merit: 1011
June 07, 2012, 07:09:36 AM
#91
Tainting will likely happen after/when Bitcoin is widespread, I would give it 12-15 years.
Sorry if this is a stupid question (couldn't find a non-ambiguous answer anywhere) but exactly what is a tainted bitcoin?

hero member
Activity: 686
Merit: 500
Wat
June 07, 2012, 06:09:40 AM
#90
Mt Gox has recently blocked peoples access to coins then forced them through onerous ID requirements claiming they came from the bitcoinica hack. You can bet the major exchanges have "blacklists" only know one before they deposit whether they are on this.


If such a thing exists I would like to know beforehand rather than risk having to deal with a  goxing because i unknowingly received tainted coins. Cheesy
legendary
Activity: 2506
Merit: 1010
June 07, 2012, 03:18:51 AM
#89
Sub

Unsub.


[Edit, damn, didn't work.]
legendary
Activity: 4536
Merit: 3188
Vile Vixen and Miss Bitcointalk 2021-2023
June 07, 2012, 03:11:01 AM
#88
Why do you think you are allowed to use force to prevent me from implementing some scheme on my own client?
Because you can't control who sends you coins. If somebody sends you tainted coins, what are you going to do about it? You can't send them back, since the address they came from may not be under the sender's control (eg, e-wallets), and you can't keep them but refuse to accept them as payment. Can you imagine if that happened with cash? "Sorry, we can't accept this $100 note as payment, you'll have to give us another one. No, you can't have this one back; no, it's not counterfeit, we just think it might have been involved in some form of criminal activity at some point in the past." You'd have some use of force directed at your face if you tried that in real life.

You don't have to accept coins that have been obtained dishonestly, either. That would be a personal choice. Because bad actors could respond, to honest traders who only making transactions with other honest people, with violence does not invalidate the idea.
The problem is that the people who respond with violence are not bad actors, they are honest people who have had their money taken without compensation based on nothing more than the belief that the money might have been involved in an illegal transaction at some point in its history. Remember, YOU CANNOT CONTROL WHO SENDS YOU BITCOINS! If an honest person happens to receive "tainted" bitcoins from someone else, there is absolutely nothing that they or anyone else can do about it, and any attempt to do something about it will simply be punishing innocent users for other people's actions.

Here's another experiment you can try: Open a store and keep a drug kit behind the counter. Drug test every note a customer pays you with, and if the result is positive, refuse to accept the money but don't give it back. See how long you can last without either getting punched in the face or having the cops called on you. I guarantee you'll be out of business one way or another before the day is out.

I encourage the sympathetic readers of this post to stop thinking about bitcoin as "cash" and start thinking in terms of a distributed file system containing a perfect accounting ledger. The idea is much more sophisticated than "cash" and will lead one day to a system that will allow us to keep track of our debts to each other in terms of personal economic value.
So, everyone's bitcoins will have a different value to everyone elses? How exactly are you supposed to set prices with such a scheme? "This product costs 10 BTC, but only 8 BTC if the coins come from a verified Mt Gox account, with a 50% surcharge if the coins ever touched SR, plus 10% if they came from a coin mixing service... etc" Is that pretty much how it's supposed to work? And if so, how does that make any sense? That would cause problems if you tried it in real life, too.

What you're asking is like asking how Mt. Gox can give you 5 USD/BTC one day and 6 USD/BTC the next day. Why are exchange rates set on an open market with bids and asks any different than devaluing dishonest money? If someone you want to trade with wants to charge you more because you have dishonest money, you don't have to trade with them. I'd encourage you to find someone to trade with that will give you the full value you believe your BTC is worth.
No, it's not like that at all, and I'm not sure why you even think that. They are different because the exchange rate assumes that bitcoins (and dollars, for that matter) are fungible, meaning that one bitcoin (or dollar) is just as good as any nother. This is because when you make an offer to buy bitcoins on an exchange, you have absolutely no way of knowing who, out of thousands of other traders, will actually be providing your bitcoins, and so you have no way of knowing whether you'll end up with good bitcoins or "tainted" ones. As I have already pointed out, setting prices will be impossible if "tainted" bitcoins are valued differently from "clean" bitcoins.
hero member
Activity: 523
Merit: 500
June 07, 2012, 02:20:54 AM
#87
This is such a non-issue, but I thought I'd chime in. If you are a vendor and someone wants to spend tainted bitcoin at your store and you refuse them, your competitor probably will not.
Only if your competitor is outside of the physical jurisdiction enforcing the taint.
This may however be a good argument against implementing taint in any particular country - as it provides incentive for people to use foreign merchants, thus harming the local economy!

If however, the control-points  are things like supermarkets which have captive local consumers - it's unfortunately not going to be enough to stop it.

Anyway.. the likely implementation would be that the merchant accepts them, but applies the prescribed tax and asks for a further small payment before you walk out of the store.


That's no remotely likely. The coins will usually be going to a safe place not accessable by the on duty clerk. If the customers doesn't want to pay or can't pay the essentially random extra tax are you going to return the coins.. later? different ones?

You are not going to have a popular store that way.

The only way this would happen is if someone forced stores to do it. And even then they would probably bail on bitcoin unless someone was forcing them to keep using it.

Tainting will likely happen after/when Bitcoin is widespread, I would give it 12-15 years.

How do you prove that the coins are stolen?

If you can´t prove it, they wont be tainted.



legendary
Activity: 1246
Merit: 1016
Strength in numbers
June 06, 2012, 11:52:36 PM
#86
This is such a non-issue, but I thought I'd chime in. If you are a vendor and someone wants to spend tainted bitcoin at your store and you refuse them, your competitor probably will not.
Only if your competitor is outside of the physical jurisdiction enforcing the taint.
This may however be a good argument against implementing taint in any particular country - as it provides incentive for people to use foreign merchants, thus harming the local economy!

If however, the control-points  are things like supermarkets which have captive local consumers - it's unfortunately not going to be enough to stop it.

Anyway.. the likely implementation would be that the merchant accepts them, but applies the prescribed tax and asks for a further small payment before you walk out of the store.


That's no remotely likely. The coins will usually be going to a safe place not accessable by the on duty clerk. If the customers doesn't want to pay or can't pay the essentially random extra tax are you going to return the coins.. later? different ones?

You are not going to have a popular store that way.

The only way this would happen is if someone forced stores to do it. And even then they would probably bail on bitcoin unless someone was forcing them to keep using it.
sr. member
Activity: 266
Merit: 250
The king and the pawn go in the same box @ endgame
June 06, 2012, 11:49:37 PM
#85
You introducing a system that imposes a form of taint does nothing to prevent theft but does make using Bitcoin a hassle for those who are innocent.

Therefore I do not support this and will vigorously reject any movement towards this initiative and any like it.

I concur 100%
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