Topic: Bitcoin Mixer Penalized by FinCEN for Violating AML Law (Read 493 times)

I agree from that perspective, however, I was telling the one who replied that many people presently do not need it or do not care to need it because most of them only use bitcoin as a speculative investment.

It will come back to them and might cause them problems, however.

Just thinking about it

What about if every mixer is forced to be registered on jurisdiction and needs to abide by the laws (I'm talking about the KYC verification).
The business could still exist and be viable. Why? Because the persons using such service don't get privacy from the business but still get it from the blockchain, and that's what people are looking to get

Sure, let's say you're laundering money, the authorities won't be able to know which mixer you used. And the majority of people do not wash bitcoin for illegal purposes

The main point in this whole story (and in many similar others) is that mixing businesses are centralized services.
As long as there is a single point of failure, namely a guy running a specific service, nobody can think of keeping their anonimity sheet clean. We know the same is applicable to any other service provider, exchange, payment processing company, atm operator etc.
The very reason why bitcoin is still around after 11 years is that, as we speak, there is no single point of failure in the network.
This is why decentralized solutions are being developed.

The bitcoin mixer business is too lucrative to stop doing it. I'm sure that even if the owner of this mixer is found and imprisoned for 50 years, there will still be those who want to continue this epic, because the prospect of making $ 300 million is worth the risk)

Well, if the authorities/banksters have BTC mixers in their crosshairs now, this will probably give even more momentum to XMR.

That's not the original bestmixer, it's a scam , see the topic here
The original was .io not biz, it's just one of the thousands of scams with similar domain names trying to fool newbies.

Their last tweet that you can see from their account - https://twitter.com/bestmixer6?lang=en



But when you check the site mentioned, it is showing Apache 2 Test PAge. Seems that they are not successful in re-launching their business.

Bitcoin mixers should register their business in a more friendly crypto countries. I don't know what the government is thinking about asking KYC from bitcoin mixer's clients. Are they really ignorant about the purpose of bitcoin mixers? Have anyone heard a particular bitcoin mixer requiring KYC from their clients? I don't think so.

Yep i mean any government mostly doesn't like about privacy with reason to "protect the citizen" against crime, and before this i heard the news about https://www.zdnet.com/article/money-from-bank-hacks-rarely-gets-laundered-through-cryptocurrencies/

This is why you should never run a mixer in the US, or any bitcoin trading service for that matter. They equate trading bitcoin with "money transmitting without a license", such licenses and permits are impossible for a normal person to get because they still think that bitcoin needs the same laws as banking because they can't physically see bitcoin like you can see cash.

Governments have never liked privacy post-2001 anyway.

Do you guys remember what happened to Bestmixer.io? Their domain was seized by the Dutch authorities, and the funds were confiscated. I don't think that it is possible for Bitcoin mixers to exist publicly. They need to move their operations to the dark market. Otherwise, it is just a matter of time before the authorities seize the funds and arrest whoever operates the mixer.

Who are these people who don't want to be protected from a 5$ wrench attack? They must be stupid or frivolous. In public, transparent systems of money such as Bitcoin blockchain, it is compulsory to never disclose your identity to unwanted persons and give them any information about your addresses, history of your transactions and amounts of bitcoins you have. You simply have to preserve your privacy unless you are eager to get robbed by some bad guy.

If like this is how our privacy when making Bitcoin transactions can be threatened, however the government wants to avoid people from
using Bitcoin mixers. Hopefully in the future the government will not go any further by banning the use of mixing systems. If that happens
it could threaten the future of the mixing industry, even though I really need a Bitcoin mixer to be safe from hackers.

every human being both needs and wants privacy. anyone who claims they don't need it don't understand what privacy means until theirs is invaded then start their moaning about how the invaders wronged them!

I remember Helix,but I've never used it.
Every darkweb marketplace/BTC mixer owner should be aware that the police is going to catch him,sooner or later.
I think that the remaining darkweb markets are switching towards monero,because most Bitcoin mixers aren't reliable.


More decentralization means that everyone will become an "owner",which means that everyone using such decentralized platform is a possible suspect of a police investigation.

Is bitcoin mixing system really bad,? I dont think is appropriate to conduct KYC and the whole system is supposed to be anonymous, releasing identify isn't fair to some extents with mixing industries, I really doubt if the victim would agree with FinCEN or else will take them to court if actually he knows what to do.

I disagree. There are many people in the cryptospace that do not want or need anonymity and privacy. Mixers are a needed solution for some bitcoin holders, however, they should know that it is not perfect.

Bitcoin mixing is simply a process of obfuscating of bitcoin transactions, we ourselves can mix our transactions without having to involve any third party solutions such as mixing services or coinjoin coordinators. I can create a transaction with many inputs and outputs, for example, and therefore obfuscate it. From the protocol point of view, I am just using its capabilities, nothing else. Will it be considered money laundering, if it is not possible for surveillance companies to determine the source of funds and identify the participants of the transaction? Mixing itself is not a crime, because mixing might be done for various reasons and different purposes.

Let us assume, for example, that bitcoin is completely fungible and untraceable like physical cash is. You and your friend Bob hand over Alice two bitcoin banknotes, which are absolutely indistinguishable from each other. Alice gives you Bob's banknote, the other banknote goes to Bob. As it turned out, Bob was a drug dealer and obtained his banknote selling illegal stuff. What Alice did is act as a mixing service, that is, according to FinCEN, commit a crime. What she actually did is give you someone else's fungible bitcoin banknote. Does it make sense? Can Alice be accused of money laundering? Doesn't it sound like an attack on fungibility of bitcoin?

I have read this kind of investigation and it took them years to finalize the suspected Mixers or Blenders to get penalized and finally shut them down. Most of those sites just close their services before such things happened but those who are caught and found guilty with the said violations will get penalized like what we have seen in this topic.

In most cases, they just stop their services no matter how long they have been working. That's why we better be careful about choosing which Bitcoin Mixers we will use to avoid such things in the future.

At first, people still complain about crypto exchanges asking for KYC documents and is there really someone asking for bitcoin mixer and KYC verification? It's very hilarious.

For me, Bitmixer was just a legend that happened in the crypto world. This website started well, offered an innovative product, did an amazing job, got a hell of a profit and ended up well. This is how real professionals act! They knew a time when to stop.
But... Another legend is Chipmixer. If I didn't know the background story of bitmixer and most of the things about them, then I would directly prioritize chipmixer. They started their business during the most dangerous time, they started when even bitmixer decided to close, were under the attention of media because a lot of bitcoins were laundered under using their service and still continue operation. I have no words to say...

Also, there is one thing: When you solve one problem, the second one arises. In history, there was time when they weren't able to identify and track bitcoin users and now this time came, they are great at catching people (and that's good if they catch scammers and this kind of people). But, tomorrow things will develop further and they won't be able to track again for a while. This is an endless cycle where the rabbit runs and then catcher follows it.

Next is the one who does something like this in a way that doesn’t protect himself. If this kind of service operates from a country that really do not care what the US thinks or says, and if the owner has protected his identity, then I don't see why we should worry that the mixers won't survive.

There is no doubt that some governments would do anything to completely prevent mixing, but they would also be very happy to be able to find a way to destroy Bitcoin - none is something that will have a positive outcome for them, no matter how much time and money they spend.

Precedent. The Ministry of Justice first called the Bitcoin Mixing a crime.

This is certainly not the best bell for the mixing industry. No matter how soon they will prohibit such services based on this classification.

soon they will wake up

indeed, no doubt that the government always trying to track down any illegal activities including linked to bitcoin transactions.
Remember what happened to bitmixer.io in 2017?
"On July 24 the operator of the website and bitcoin mixing service Bitmixer.io announced the operation is now ending its mixing services.
Although many Bitcoiners assumed the closure was due to law enforcement pressure the owner insists it is due to a change in his ideology."
"I hope our decision will help to make Bitcoin ecosystem more clean and transparent.I hope our competitors will hear our message and will close their services too. Very soon this kind of activity will be considered as illegal in most of countries.
Whoever owns a mixing service, better to remain anonymous for the good sake of us. we definitely need a mixer.

an easy one, more decentralization. when there is no "owner" to catch, there is no "KYC" to force onto them and there is nothing they can do.
wanting privacy is everyone's right and they should be able to achieve it one way or another. the more KYC rules the government forces on different services the more advanced and popular the privacy improvement methods such as CoinJoin will get.

This is quite concerning. Clearly the authorities don't like mixers (they actually don't really like Bitcoin neither) and whenever they can they will fine them, close them and most probably also try to get all the info they can about the transactions in order to track the money flow. It's a cat and mouse game and the fact they fined mixer for not enforcing KYC tells it all: basically all mixers found in their jurisdiction can easily have the same fate.

I still remember this sudden closure of Bitmixer and we can connect it with this thing. Which we can say that if there will be no voluntarily stop in operation, they would be seized by fincen or any governing body of the government that's tracking the owners of it.

That's what fincen wants to happen but do they think that people supports anonymity would be blind to follow what they're trying to say? no way.

When the big companies start entering the market, they will start looking for ways to ensure that it is difficult to evade tracking, so the censorship will become tighter and more people will be arrested.
Helping others hide their personal data and concealing information is a crime, so it is easy to find the legal wording for the arrest.



When the NEXT mixer makes a mistake.

It appears that everyone who wants or needs anonymity and fungibility must begin to remove themselves from bitcoin and stop delegating their privacy to the owners and administrators of mixers.

Who will use Bitcoin mixer if privacy is broken with KYC verification. It is a joke story. Unfortunately I believe that more governments will try to force companies to do KYC verifications on users, from exchanges to casinos and maybe bitcoin mixers.

Fortunately, like as happened with crypto casinos, there are nations accept crypto casinos and bitcoin mixer companies can move to nations accept their services without law enforcements with KYC verifications.

I don't now if FINCEN is sending a strong signal or just want to show example of future takedown.

Bitmixer.io The lagest Bitcoin mixer is about to stop working for one voluntarily shutdown their business in 2017, while BestMixer is gone, seized by the Financial Crime Investigation.

I'm sure those behind bitcoin mixers is doing everything they can to be anonymous, so it will be a cat and mouse game, not sure who's next though, your guess is as good as mine.

What's going to happen if Bitcoin will get privacy updates and will essentially become one big mixer? Are these authorities going to ban Bitcoin? Or pressure developers, many of whom are public figures, to install backdoors or revert the updates, even under threat of imprisonment?

Meanwhile fiscal paradises are doing fine, including US ones. All such services must look at relocating to such places (not US ones, though) ASAP, I don't know which would be the best.

Also keep as much info about the people involved (owners, developers etc.) secret.

I agree and it is surprising that especially for a mixer many people still go for KYC. KYC is questionable even in gambling and pretty much everywhere involving crypto, so doing KYC for a mixer is not such a good idea.

It would not make any sense for the government representative bodies to try and go for the 'small fries' where in actual fact the issue lies with providers. There will be nothing in for them, and costs and resources won't be justifiable or at least this is what my thoughts are 

Yeah try sounds kinda significant there, I doubt it'd actually hold if they ended up in court in the US...

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I don't think the US have come out like Europe have and said that cryptocurrencies are fairly relaxed regulation wise. This is either the government trying to make bitcoin more mainstream, trying to kill it or just a show of power for what they could do...

There would be always an endless battle towards government and these mixing services.We have seen in the past that Bitmixer and other who had followed the path.
https://venturebeat.com/2017/07/25/bitmixer-shuts-down-to-make-bitcoin-ecosystem-more-clean/

Its just obvious that their reason is just trying to divert but actually theyre scared on possible things that might happened ahead.

Wont be surprised if this one will happen on recent Mixers at the moment.

The possible scenario is either this mixing service will comply with FINCEN's regulation or just stop the service. I wonder if it will still be called a mixing service when in fact your identity was known to anybody, mixing service should be preserving your privacy and anonymity.

LOL! Who will ever provide an identity on a darknet based bitcoin mixer operating on the darknet markets? Surely, regulators are sometimes dumb IMO, furthermore, it's a mixer and that's how it suppose to be. Well, he has been charged already and whoever comes next, "surprise surprise" says the regulators.

These are scare tactics by the authorities so that the mixers that are running the mixers should close their doors and move on, if not they will be coming after that and it is a clear warning they are giving by fining the owner $60 million and no one would want to risk that much to run a mixing service when the authorities are after them.

The developers of Wasabi Wallet must be feeling nervous right now. This is why they make you agree to certain terms and conditions when you first install the software; to try and cover themselves legally should governments start going after mixing services.

Post title say 'First Bitcoin “Mixer” Penalized by FinCEN' and that only means that other mixers will follow next.
I am not sure what is the right solution for this, but surely doing KYC customers for mixer is very stupid.
Regulations are getting crazy, and what if they start to track and arrest not just owners but regular people and users?

Take your pick.

Surely not everybody here but we remember about Helix, which was a popular Bitcoin mixer a few years back. It was a popular service on the dark web, especially Alphabay.

https://www.justice.gov/opa/press-release/file/1249026/download

The person behind this site was arrested a few months ago. Accused of laundering millions of dollars and they say to have succesfully identified about 300 000 bitcoins

https://www.justice.gov/opa/pr/ohio-resident-charged-operating-darknet-based-bitcoin-mixer-which-laundered-over-300-million

Today the FinCEN has fined the owner with $60 million USD for violations of the Bank Secrecy Act, unregistered money services business (MSB).
In short, for not being registered with FINCEN and didn't ask for KYC to customers.
(Yeah sure, a Bitcoin mixer with a KYC verification)


https://www.fincen.gov/news/news-releases/first-bitcoin-mixer-penalized-fincen-violating-anti-money-laundering-laws

It surely won't be the last if they're able to get the owner.  Who's next?