Topic: [Blacklist] of unreliable, 'taint proclaiming' Bitcoin services / exchanges - page 10. (Read 2791 times)

In my case I have not had any problems with crypto gambling sites and as I have said in other threads, I play poker on fiat sites because there is much more traffic and better software, besides you can use statistics software (legal). The problem with crypto poker sites is that if they are without KYC it is easy for several players to collude. In other words, privacy makes it easier to cheat.

From what I know about gambling sites there is a trend that is the same as what we are discussing in the thread. Years ago practically no gambling site required KYC. Nowadays there are a few left but less and less, so the trend in the future is going to be like that. If we want to defend privacy we should defend the gambling sites without KYC, and only play in them. But the fact is that privacy has been lost in gambling and the use of crypto gambling sites does not seem to have decreased.

Btw, all this issue has made me think a lot and I have created a poll about it: Act to defend privacy or resign ourselves to its loss?

"Taint" becomes real if enough people believe it's real. So this will depend on the users, but given that many users accept KYC-demands, they'll probably go for this too. I don't have high hopes.
Privacy changes on the protocol level could help, but I have no idea how likely that is to be implemented.

Feel free to add any similar experiences you've had (maybe with funds coming from poker sites - as your name suggests) and I can add them to the OP! I know some exchanges and other services complain about funds from gambling sites, but don't know exactly which ones, so any feedback in this direction from a long-time forum member would definitely be appreciated.

I personally don't think so (short-term), however if services realize that large amounts of users stop trusting them with their coins if they show such (unreliable / untrustworthy) behavior, they might stop considering going more strict with KYC/AML and blacklisting / 'taint definitions'. Long-term it might convince companies who already went 'down' the 'taint route' to do a U-turn; it's much harder to do though, since they'll have to somehow explain they you suddenly accept 'dirty criminal coins' that they previously deemed 'bad' and unacceptable.

It's a good thread; however as pointed out there, we still have alternatives, some of which are P2P and / or fully decentralized. I strongly believe we can educate people to stop conforming with outrageous, unreasonable rules that e.g. exchanges put in place and stop doing business with them. If enough people understand this (which is a pretty reasonable / logical thing - since good alternatives do exist), the centralized services will be forced to back-pedal if they don't want to go out of business.

This blacklist is very commendable.

Does anyone believe that over the years these companies will change their behavior? Because what I see is that the list of companies will get bigger and bigger. There will be more control, less privacy, more KYC/AML and more blacklist of supposedly tainted coins.

I already expressed a similar, rather pessimistic opinion in my thread: Goodbye, privacy, goodbye, it was nice while it lasted.

Convince me otherwise, please.

LOL, Bitcoin has gone religious or what?



I take a plain Bitcoin too!

How about curses?
If this doesn't show how much BS the idea of "tainting" is, I don't know what does

No, it was a theoretical example.

The $100,000 might get more interest, but does that mean the "taint" disappears for small transactions? It sounds arbitrary.
And what if the miner gets a transaction fee from a drug dealer? Or if the drug dealers pays a very high fee to a friendly miner who gives him back fresly mined coins?

For who hasn't read it yet: ChipMixer explains it nicely:

---

---

So, we now have cursed Bitcoins. I bet church can sell blessed Bitcoins at a premium. And vegan Bitcoins. Meat Bitcoins. Coffee slave Bitcoins. Drug Bitcoins.
Or just Bitcoins. I'll go for that.

Do you have any evidence that this is happening? I don't think it would be difficult for a blockchain analysis company to see the difference between someone buying $100 worth of drinks at a bar, and a someone selling $100,000 worth of coin.

---

When you spend 1BTC, you are spending a very specific output of a previous transaction, or a very specific set of outputs from previous transaction(s). If you are spending that 1BTC, the transaction fee you will need to pay will depend on how many outputs you are spending.

...

A very useful thread, thanks OP and other repliers.  These facts/policies/thoughts are important because they do indeed cast light on threats to BTC and the philosophy of privacy.  Very important.

*   *   *

*Gemini, my experiences only*

In January 2021 I finally joined Gemini.  I did the whole KYC thing, answered their questions, etc.  I did this because I wanted to sell some of the BTC I had acquired for MUCH cheaper, and so take some gains.  I sold a lot between January and October (2021).

When I applied to get into Gemini, I told them upfront that most of my coins were mixed and/or coinjoined.  I told them that I was not doing illegal things, but valued my privacy.  No drugs, no gambling.  US citizen.  I wanted to sell some BTC to take some gains.

They took me on.  I went on to sell a large percentage of my BTC at those wonderfully high prices in 2021.

Gemini had some questions about the way I was selling (some small amounts a couple of times a week for a few months), they thought I might be cashing out BTC from a business.  I told them no, I was selling that way because I wanted to CA$H IN some BTC and that I was not smart enough to sell at the All Time High, so I was selling over a period of relatively high prices (Jan - Oct 2021).  And Gemini was OK with that.  And as far as I am concerned, Gemini served me well (albeit with KYC and explanations).

Yes, I'd absolutely add such sites that just arbitrarily reject certain 'coins'.
Anyone trying to come up with a definition of 'pollution' of BTC is actually attacking Bitcoin's fungibility and should be called out. That's what this thread is for.

---

An easy way to understand it is the comparison to 'dirty fiat' that LoyceV has brought up: nobody rejects a paper bill you got by winning at a casino or a lottery or one you got by selling drugs. Nobody inspects bank notes for illegal substances or checks the serial numbers.

Another point to consider would be that laws differ around the world. I may live in a state where growing and selling marijuana is legal, so selling it for BTC would be absolutely legal; however if I send the coins to someone in a different state or use the BTC to pay for coffee, and someone would somehow label it as 'drug money', it couldn't be spent anymore. Wouldn't that be pretty crazy?
If this seems far fetched, think about something else: booze. In most parts of the world, nobody would label me a criminal if I were to sell home-brewed beer. But there are places where alcohol is indeed illegal.

What I'm trying to say is: we can't restrict Bitcoin that was used for activity X because it is illegal in state Y. Bitcoin knows no states, borders or laws.

I'd say it's about any reason to consider some Bitcoins more equal than others.

Note that this isn't about exchanges freezing funds owned by drug dealers, that's understandable. It's about freezing funds from the bar where the drug dealer bought his coffee.

Does anyone know why they reject the “polluted” coins or on what legal basis they base their classification on these coins? In the end, the coins that come from the mixtures are not necessarily illegal or from illegal sources?

Does your service include sites that do not accept bitcoin from gambling, porn, drug promotion, etc.? Or are you talking about mixing/“polluted” coins specifically?

In the previous days, we started hearing the term green coins "those that have been mined from environmentally friendly sources" and which many platforms "such as Coinbase" may adopt for reasons related to the stock market.

Thanks for the quotes Loyce! Informing people is exactly what this thread is aimed at; though admittedly it's mostly focusing on keeping a list of the entities that are known / proven to try make people believe some coins are 'tainted'.

I've seen several posts lately from people willing to treat Bitcoin as non-fungible because they believe some coins are "tainted".
I'd say this is a severe threat to Bitcoin, and I wouldn't be surprised if governments use this because they can't stop Bitcoin in any other way. If people believe Bitcoin is "tainted", they won't accept it anymore. "We" should really inform people not to fall for this.
Nobody would reject a dollar bill because it has previously been used in a crime, despite the fact that 85 to 90% contains traces of cocaine. Claiming Bitcoin isn't fungible is just plain stupid.

Here's a few examples:


BestChange.com should be added to this list. Even though they're not an exchange, and even though I've used them, they seem to think not all Bitcoins are equal:

---

---

This site explains very well what it's all about:
I can't stress enough how important this is!

That was already included in OP!

True, I'll add a disclaimer, thanks! That's the reason this is a 'blacklist', not a 'whitelist' (in that, anything not on the list isn't guaranteed to be safe).

Trading larger volumes is an interesting question indeed. We pondered about that a bit on a tangent in this topic [How to leave KYC for good] and I don't think there's a really '100% safe, but also tax compliant' solution yet.
I believe if someone were to open an exchange in a crypto-friendly country like Portugal or El Salvador, that exchange may not be pressured as much when it comes to AML and maybe even KYC; while still providing European / American official documents that you can use when doing your taxes.

At any time, for any reason, we may have a problem with any centralized exchange.

This is why we should always send our coins in batches to exchanges.
I have made some big sells in binance last years when we reached ath. I was afraid they could reflect my funds, so I send in 3-4 transactions. Only after the fiat withdrawal I made the next btc transaction.

No problems, and there were some mixed funds and some funds from casinos.

But I don't trust any exchange.

In Brazil, selling big amounts in p2p transfers may be a problem with tax authorities. It is not illegal, but  it is more likely that they will demand more information, which is quite uncomfortable

Alright, thanks for the feedback, I'll remove it for now, then!

I understand that, but I'd like to compile a list of only 'verified' services / i.e. ones where there's a clear precedent.

They can, sure. But I'd like to know and make visible to everyone which are either openly against fungibility / mixing and condone it officially or where many users have reported such issues in the past.

All hearsay but it seems to be as you go above certain levels of trading they want more KYC. But from what people are at least admitting to it seems to be based on amounts, not any particular coins. We can't know the truth of what Gemini is thinking or if what they are posting is true so......



What I have seen several complaints about is people move fiat in and don't trade and then pull the fiat out. And then they close your account.
Once again, posted on the net so you can never know the true story about amounts and other things. But I can see that triggering something.

-Dave

Any centralized exchange is going to be accountable to the government where it operates. Western governments are going to expect exchanges to follow AML laws to prevent money laundering.

If you don’t like this, as oelio points out, your only real option is to not use a centralized exchange.

---

The information that those in the list in the OP are using is ultimately public information. Anyone can look at the same information and come to their own conclusions.

But what prompts them to request additional info? Some sort of blockchain analysis which flags up something you did as "suspicious".

Is this not based on blockchain analysis though? You did something with your coins that they didn't like? Is that not taint?

---

There was another similar thread about this just a few weeks ago here: Black List of crypto exchanges! (BANS and confiscation)
Although it was discussing exchanges sanctioning Russian users, I'll quote myself from that thread here, because it is very applicable:

Any exchange that works with Chainalysis and similar companies can freeze customer accounts if their tracking software marks their addresses as ''tainted''.
You are missing Binance exchange from that list, and they are freezing accounts for sure for various reasons if they think something is suspicious.
I remember reading before how many Colombian users accounts got frozen, and others got flagged for risk management and anti-money laundering:
https://insidebitcoins.com/news/binance-sued-by-colombian-users-for-frozen-accounts
https://www.coindesk.com/tech/2021/05/12/so-many-locked-out-binance-users-say-their-accounts-have-been-frozen-for-months/

PS
Don't forget that fake dex exchanges (like Uniswap) can also freeze your funds.
Paxful P2P exchange is the first P2P exchange that works with Chainalysis, so you know what that means.