How to avoid thefts using stolen bitcoins. - page 2.

InwardContour

sr. member

Activity: 644

Merit: 260

Quote from: musician on July 12, 2014, 03:58:38 PM

Quote from: InwardContour on July 12, 2014, 03:31:59 PM

Quote from: BittBurger on July 12, 2014, 03:19:09 PM

Why would this affect fungibility?

The OP is not talking about a central authority doing anything that would stop the Bitcoin economy from functioning as normal.

From what I am reading - he's just talking about a notification and monitoring system.

And you dont need blacklisted or marked coins to do it either. Just the blockchain.

The thief tries to cash out and the bank is notified that its stolen funds, simply by following the trail of public transactions on the blockchain.

Nothing more than passive monitoring and alerts.

The bank doesn't "freeze" the coins in some strange, abnormal way. They simply don't let the thief have them. The coins are still completely viable and would simply be held in an account and returned to the victim.

Im not seeing what is wrong with this idea, except for the risk of "mixers" and the like.

But a company providing this service will no doubt recover people's money quite often. There will be "smarter" thieves who can figure ways around it, but just like with everything else, a large portion of thefts are done by idiots.

The OP says that once the stolen coins are sent to a merchant/exchange they would be frozen. This would imply that this company would act as a central authority (or simply act as an authority) that would freeze "stolen" coins

Obviously what I meant is that once is clear the victim is really the victim (if that makes any sense) the bitcoins would be returned to the victim.

But even if the victim really had their coins stolen it would not necessarily mean that the person who sent the coins to the exchange is the thief

musician

full member

Activity: 182

Merit: 100

Quote from: InwardContour on July 12, 2014, 03:31:59 PM

Quote from: BittBurger on July 12, 2014, 03:19:09 PM

Why would this affect fungibility?

The OP is not talking about a central authority doing anything that would stop the Bitcoin economy from functioning as normal.

From what I am reading - he's just talking about a notification and monitoring system.

And you dont need blacklisted or marked coins to do it either. Just the blockchain.

The thief tries to cash out and the bank is notified that its stolen funds, simply by following the trail of public transactions on the blockchain.

Nothing more than passive monitoring and alerts.

The bank doesn't "freeze" the coins in some strange, abnormal way. They simply don't let the thief have them. The coins are still completely viable and would simply be held in an account and returned to the victim.

Im not seeing what is wrong with this idea, except for the risk of "mixers" and the like.

But a company providing this service will no doubt recover people's money quite often. There will be "smarter" thieves who can figure ways around it, but just like with everything else, a large portion of thefts are done by idiots.

The OP says that once the stolen coins are sent to a merchant/exchange they would be frozen. This would imply that this company would act as a central authority (or simply act as an authority) that would freeze "stolen" coins

Obviously what I meant is that once is clear the victim is really the victim (if that makes any sense) the bitcoins would be returned to the victim.

InwardContour

sr. member

Activity: 644

Merit: 260

Quote from: BittBurger on July 12, 2014, 03:19:09 PM

Why would this affect fungibility?

The OP is not talking about a central authority doing anything that would stop the Bitcoin economy from functioning as normal.

From what I am reading - he's just talking about a notification and monitoring system.

And you dont need blacklisted or marked coins to do it either. Just the blockchain.

The thief tries to cash out and the bank is notified that its stolen funds, simply by following the trail of public transactions on the blockchain.

Nothing more than passive monitoring and alerts.

The bank doesn't "freeze" the coins in some strange, abnormal way. They simply don't let the thief have them. The coins are still completely viable and would simply be held in an account and returned to the victim.

Im not seeing what is wrong with this idea, except for the risk of "mixers" and the like.

But a company providing this service will no doubt recover people's money quite often. There will be "smarter" thieves who can figure ways around it, but just like with everything else, a large portion of thefts are done by idiots.

The OP says that once the stolen coins are sent to a merchant/exchange they would be frozen. This would imply that this company would act as a central authority (or simply act as an authority) that would freeze "stolen" coins

allthingsluxury

legendary

Activity: 1540

Merit: 1029

This idea was floated out there before.

BittBurger

hero member

Activity: 924

Merit: 1001

Why would this affect fungibility?

The OP is not talking about a central authority doing anything that would stop the Bitcoin economy from functioning as normal.

From what I am reading - he's just talking about a notification and monitoring system.

And you dont need blacklisted or marked coins to do it either. Just the blockchain.

The thief tries to cash out and the bank is notified that its stolen funds, simply by following the trail of public transactions on the blockchain.

Nothing more than passive monitoring and alerts.

The bank doesn't "freeze" the coins in some strange, abnormal way. They simply don't let the thief have them. The coins are still completely viable and would simply be held in an account and returned to the victim.

Im not seeing what is wrong with this idea, except for the risk of "mixers" and the like.

But a company providing this service will no doubt recover people's money quite often. There will be "smarter" thieves who can figure ways around it, but just like with everything else, a large portion of thefts are done by idiots.

harles9

member

Activity: 68

Merit: 10

I've only ever actually purchased bitcoin hardware from Newegg (only once I learned quickly that it was not worth it... one of my first forays into mining, lol).
And KNC.

Fortunately, KNC actually delivered but it seems like not everyone has these experiences...

Meuh6879

legendary

Activity: 1512

Merit: 1012

if you don't trust a commercial ... don't use it Roll Eyes

scam always exist even if you use bitcoin in all this world.

if you want buy a think in aliexpress from a "lost" china store ... with a wire money, you don't have an escrow to save money.
many business must secure is product stock to sell locally.

many customers don't find or read the real adress of a seller in a site before buying.
they are dumb and for this, they loose BTC.

not a problem for me.

InwardContour

sr. member

Activity: 644

Merit: 260

Quote from: musician on July 12, 2014, 12:40:12 PM

Let me start that this might sound stupid, since I have no idea about any technical thing about bitcoins, programming, etc, but I was reading about the guy who lost over 1000 bitcoins and came up with this. You tell me if it's posible, realistic or it's not. Here we go:

Someone creates a business called X, and what it does is the following: once you are robbed, you send them the adress and number of btcs stolen. Since this moment, the ddbb from X monitors the blockchain from those btcs, adding each adress to the ddbb. At the same time, exchanges, bitcoin shops, and gateway payments are connected to that ddbb, so since the moment they receive btcs from an adress that is on the ddbb would raise a red flag and freeze the btcs.

Obviously, since someone reports would have 24/48 hours to prove they were stolen ( screenshots, police reports, etc). And also, for a business to be connected to that ddbb would add value to their work.

Good idea? Stupid?

The moment that you attempt to freeze the coins it would make it a very bad idea and it would make bitcoin no longer fungible.

One possible variation to this plan would be that the identity of the customer would be provided to the company "x" however even this is not the greatest of ideas because it is very well possible that the coins have traded hands several times prior to the customer coming into "possession" of the coins.

franky1

legendary

Activity: 4424

Merit: 4794

Quote from: musician on July 12, 2014, 12:40:12 PM

Let me start that this might sound stupid, since I have no idea about any technical thing about bitcoins, programming, etc, but I was reading about the guy who lost over 1000 bitcoins and came up with this. You tell me if it's posible, realistic or it's not. Here we go:

Someone creates a business called X, and what it does is the following: once you are robbed, you send them the adress and number of btcs stolen. Since this moment, the ddbb from X monitors the blockchain from those btcs, adding each adress to the ddbb. At the same time, exchanges, bitcoin shops, and gateway payments are connected to that ddbb, so since the moment they receive btcs from an adress that is on the ddbb would raise a red flag and freeze the btcs.

Obviously, since someone reports would have 24/48 hours to prove they were stolen ( screenshots, police reports, etc). And also, for a business to be connected to that ddbb would add value to their work.

Good idea? Stupid?

say you had 1btc stolen
the theif can deposit it into bitstamp and instantly withdraw 1BTC. he has 1BTC but the address it came from is different. this is because the coins mix together. (research: mixers) in bitstamps wallet system, so now the thief can go to local bitcoins free and clear to cash out, while you are tagging unsuspecting other people, whom unluckily get those coins mixed in with their withdrawals.

the other thing is that the theif can move the btc into other addresses he does own, splitting the coins inot small amounts of 0.001 amounts meaning you now have to tag 100 addresses in the 5 minutes it takes for him to form a 100 address multisend. he then in the next 5 minutes moves each cointo a single address and repeats the process again.. withing 15 minutes you could easily end up with 300 addresses you have to tag.. never knowing if its truly him or a deposit/withdrawal from a service/mixer.

R2D221

hero member

Activity: 658

Merit: 500

This was also proposed for the FBI seized coins, and most people didn't really like the idea. The problem is that a central authority regulating this would make Bitcoin centralized, which makes it more vulnerable.

CIYAM

legendary

Activity: 1890

Merit: 1086

Ian Knowles - CIYAM Lead Developer

The idea is nothing new (google "bitcoin blacklisting") and unfortunately has the problem that "how do you know it was really stolen?" (not saying that Klee's case is not legit).

You end up with some sort of "centralised blacklist" that then destroys the "fungibility" of Bitcoin (same as if you were given a $10 note that turned out to be stolen do you think it is fair that you should lose that $10?).

This is why comparisons with "gold" make quite a bit of sense when it comes to Bitcoin as people can "melt down UTXOs" through mixers such that it is practically impossible to tell who are "the thieves or the innocent victims".

TsuyokuNaritai

hero member

Activity: 574

Merit: 500

The main problem with this is that BTC would then no longer be fungible.

musician

full member

Activity: 182

Merit: 100

Let me start that this might sound stupid, since I have no idea about any technical thing about bitcoins, programming, etc, but I was reading about the guy who lost over 1000 bitcoins and came up with this. You tell me if it's posible, realistic or it's not. Here we go:

Someone creates a business called X, and what it does is the following: once you are robbed, you send them the adress and number of btcs stolen. Since this moment, the ddbb from X monitors the blockchain from those btcs, adding each adress to the ddbb. At the same time, exchanges, bitcoin shops, and gateway payments are connected to that ddbb, so since the moment they receive btcs from an adress that is on the ddbb would raise a red flag and freeze the btcs.

Obviously, since someone reports would have 24/48 hours to prove they were stolen ( screenshots, police reports, etc). And also, for a business to be connected to that ddbb would add value to their work.

Good idea? Stupid?

Topic: How to avoid thefts using stolen bitcoins. - page 2. (Read 2036 times)