Interesting CoinDesk about "Dirty" Gold and "Dirty" Bitcoin - page 2.

Kakmakr

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Have you ever considered WHY governments wants to have 100% control over assets & commodities and also Crypto currencies? The answer can be found in the history of some government actions. Let's take one example from the USA in April the 5th, 1933... The US government signed, Executive Order 6102 .. forbidding the hoarding of gold coin, gold bullion, and gold certificates within the continental United States. - Source : https://en.wikipedia.org/wiki/Executive_Order_6102

So, governments needs to track all of these things in order to enable them to go directly to the citizens to seize aforementioned wealth, if they enact a new law or if there are some reason to protect their interest.

Yes, it is masked with excuses that it helps them to prevent money laundering and criminal actions, but the real reason is control and power over people's wealth. Angry

Most importantly, when they know how much wealth you have, they can get more TAX from you.

avikz

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Quote from: ?? on ??

Quote from: OROBTC on August 13, 2020, 01:49:01 PM

If the exchanges crack down on those who want to cash-out of BTC that is "dirty", then IMO that makes BTC not perfectly fungible.

Literally, Bitcoin will become 'dirty' if used for illegal transactions. Just as money is generated on the black market for transactions in illegal goods, it will become 'dirty'. In that sense Bitcoin is not a fungible goods. However, can exchangers do the sorting for 'dirty' bitcoins and still 'clean'? Of course it's not easy.

It's definitely not easy and that's why tools like chainanalysis found their way into the market - to track the origin and usage of a particular bitcoin by tracking down its entire transaction history from the blockchain. Definitely such kind of tools make certain bitcoin less fungible than others! That's why the community coined a new terminology called - Virgin bitcoin which are freshly mined and people are paying as much as 20% premium on the market price to get hold of such virgin bitcoins. It's a reality!

We already have seen few instances where exchanges banned user's account because the bitcoins they have withdrawn directly to a mixing service. Refer to the below discussion.

https://bitcointalksearch.org/topic/exchanges-are-now-potentially-banning-btc-sent-to-a-mixingconjoin-services-5221894

Chain Analysis is ruining the game!

witcher_sense

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Bankers are starting spreading false narratives that your bitcoin needs to be controlled by them, because otherwise your coins will be considered dirty.

What that writer at large Canadian bank forgot to mention is that unlike gold, bitcoin is a decentralized code, it is a programmable money that exist beyond any borders and jurisdictions. What it means is that if some party starts thinking it is powerful enough to dictate the rules of how to use decentralized network, it will be immediately deprived of this power by other participants of distributed decentralized network. Since bitcoin is just a code that can be modified if majority of community agrees with that, it is always possible to remove any "dirtyness" from bitcoin by making it more private, untraceble. In this case, any fungibility discussions will not make sense anymore.

mk4

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It doesn't really matter in the long run, and the retail traders and users of bitcoin don't give a crap anyway.

At some point in the future, all or most of the circulating bitcoin would have circulated(and hopefully mixed/coinjoined) enough that every single one would be so called "dirty" or "tainted" anyway, that exchanges and centralized services won't have a choice but to allow them on their platform.

BayAreaCoins

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Anyone trying to peddle "dirty" bitcoins is a scammer or a LEO or both.

Avoid. There are no dirty Bitcoins or metals or fiats, UNLESS, you knew they came from a crime.

Dirty is a mindset and a stupid Bitcoin mixing service isn't going to help that... in fact, it's probably going to expose your shit to someone you'd really rather not fuck with.

pooya87

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it is not an issue, or lets say it is being exaggerated a lot. and the more "chain analysis" companies that sprout like mushrooms, the more exaggerated this situation is going to get.

bitcoin is a currency and is fungible and like any other currency it is used for a lot of things that includes illegal activities. at some point in the future (mass adoption) we may even see any transaction to be linked to some illegal activity in its history when you go back long enough. that shouldn't change anything though because you should always compare it with other currencies. take US dollar for example. majority of the bills in your wallet right now are already linked to some illegal activity which is usually drug trafficking. there is even traces of drugs such as cocaine on them. but nobody raises these issues because USD is not new and is not currently under magnifying glass.

as for mixers and coinjoins transactions that may cause some issues for the users, it is like that because their number is still low. so the exchange can easily restrict those handful of them and cause issues but if there were more (like if 80% of their deposits came from coinjoin txs) they would never be able to put any kind of limitations for such transactions.

LUCKMCFLY

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One of the reasons why bitcoin was created was to prevent third parties from manipulating the money, in this case they speak highly of KYC as to show that it is a kind of London Bullion Market Association (LBMA) as they say in the article, but this technology is not handled like that, gold is something else, which is handled physically, and has many more controls and even its taxes are high, apart from that it is globally recognized for its history, in which case I think that for The nature of Bitcoin is not suitable for KYC, especially for those who love anonymity.

rollingdice

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Bitcoin is a beautiful system with its own standards. We don't need to build another meta-system to control and regulate it. I don't like an idea of introducing Bitcoin as Gold 2.0 or creating Bitcoin's version of the LBMA.

Shimmiry

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Quote from: OROBTC on August 13, 2020, 01:49:01 PM

...

Shall we blame the bitcoin mixer platforms such as the long running and successful chipmixer? No of course! Why? Because they simply value your identity, your privacy per se. No matter what were the cause or where does your crypto came from, it would only be bitcoin - a digital fiat, a mode of payment. Justifying as either dirty or clean wouldn't change the fact that it reaches a lot of blocks and probably mixed with both clean and dirty as well. Gold is really sensitive with such labeling as it is an issue if they would have it by stolen and would soon be need to be taken legally if they were to accept it.

Sadlife

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Then that would make Fiat the same as well, with banks stealing value from other supply in circulation, and using that fresh money to buy assets and debts, making the poor, poorer and the rich even richer. Wouldn't that make the paper money and the whole financial system much worser?
Before talking about the bad side of Crypto, you should ask yourself. What are the corrupted banks are doing.

crwth

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There's nothing in the article saying that it's "worthless" if it's dirty, it would be "worth less." Less than the possible original value, not wholly no value. Readers here should be aware of that fact first.

I don't think it would be entirely applicable for apply the type of standard such as LBMA because all of the Bitcoin in the network are from the system itself, and you could never add to the supply that it has now. According to the wiki, the function of LBMA is quoted below.

Quote from: https://en.wikipedia.org/wiki/London_Bullion_Market_Association#Functions

LBMA's mission “is to add value to the global precious metals industry, by setting standards and developing market services, thereby ensuring the highest levels of integrity, transparency and trust.”

There are factors like making Bitcoin more precious would be the ideal purpose of the "future standard" that's going to be applied to Bitcoin, but technically, it's going to take a lot of hard work, IMO. It doesn't make sense anymore, as long as you have Bitcoin in your wallet, you are good. If you are transparent where you got it from, it would be good. I don't think it's worth discussing.

It's the people who are Dirty, not Bitcoin.

Wexnident

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Mixers exist okay? Dirty Bitcoin in the end would only remain dirty on the hands of someone who doesn't know about how it works and how to avoid detection. Sure, in the future there may be a way for mixers to filter dirty coins from being mixed, but right now? No such precedent exists afaik. Plus, even if some coins were detected and obtained by a legal team, said coins would then be auctioned off in public to mark it as clean.

The article discusses a bit about checking the transaction history of Bitcoin whenever being traded to make sure it's clean, but what if they passed by the mixers as I said? Transactions would be cut off from there, and what would be the judgement for coins that came from mixers? Would they be labeled as dirty even though some of them may just have came there to mix their coins for other purposes?

OgNasty

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This is the supposed non-scammy reason that coinmixers exist right?

dothebeats

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Quote from: GideonGono on August 13, 2020, 03:32:10 PM

Dirty BTC is worthless?
We don't even know which BTC is Dirty and what would the owners of those BTC feel if you would tell them that it is worthless?
How about if they are new in crypto and bought it on exchange would it still be consider as worthless ?

Not that it's worthless, but it somehow links you to a possible scam/illegal scheme involving those bitcoins that you received. This puts the receiver of that coin into some kind of 'watchlist' that law enforcement updates every so often for potential criminals. It is not an ideal list to be in, trust me, and it might even go so far as to involving you in crimes you didn't commit.

Also, it's easier to trace which coins are dirty and which coins are clean. There are taint analysis tools dedicated for that kind of thing, though I believe it isn't as comprehensive as what law enforcement people use but you will, at least, get the idea on where the coins came from.

Quote from: GideonGono on August 13, 2020, 03:32:10 PM

BTC would never be worthless even if it is dirty or not we couldn't filter and just burn those BTC that has been used in illegal activity,
The dirty BTC would circulate normally if they would sell it out however they want or spend it out on crypto space.

Law enforcement usually "un-tag" dirty coins once the case involving those were cleared, or if the seized coins are put into auction for sale. Those essentially burn the dirty status of the coins and can be received once more with confidence.

pixie85

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Quote from: aesma on August 13, 2020, 02:58:37 PM

How much of circulating bitcoin is "clean" anyway ?

"Dirtiness" only matters if most coins are clean.

It's my opinion as well. The average user has no access to these chainanalysis tools and will not check if the coins he receives are clean so it's unfair to ban their coins from acceptance because they were mixed or stolen once.

What if by the time exchanges really stop accepting tainted coins at least half of all bitcoins in circulation will be tainted? Are we going to cut tradable supply in half?

logfiles

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By grading bitcoin under two categories of "dirty" and "clean" bitcoins then the so-called institutions are looking of away of taking control of most of the bitcoins especially in terms of circulation which I find stupid. It's more like, "Hey crypto folks, If you don't pass KYC and trade in these approved exchanges, then your bitcoins are dirty and of a much lower value than the bitcoins we have in here. If you move your bitcoins out of our exchanges they will also be considered dirty"

GideonGono

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Dirty BTC is worthless?
We don't even know which BTC is Dirty and what would the owners of those BTC feel if you would tell them that it is worthless?
How about if they are new in crypto and bought it on exchange would it still be consider as worthless ?
BTC would never be worthless even if it is dirty or not we couldn't filter and just burn those BTC that has been used in illegal activity,
The dirty BTC would circulate normally if they would sell it out however they want or spend it out on crypto space.

aesma

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How much of circulating bitcoin is "clean" anyway ?

"Dirtiness" only matters if most coins are clean.

OROBTC

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...

I have been wondering over the past few months about the fungibility of Bitcoin now that blockchain analysis tools from Chainalysis and others. As an example, it might be hard to get FIAT$ from some exchanges with BTC with "taint" from mixers or traces back to use in dark markets.

If the exchanges crack down on those who want to cash-out of BTC that is "dirty", then IMO that makes BTC not perfectly fungible.

Well, the gold market at the wholesale levels works somewhat similarly. The LBMA (the world's largest physical gold custodian) carefully tracks the gold bars it holds, and even allows into the system. It is very hard to get gold of uncertain provenance ("dirty" gold) into the LBMA system.

The below article explores this, and hints that we are almost there re a hierarchy of gold and BTC (dirty gold and dirty BTC are worth less):

https://www.coindesk.com/bitcoin-gold-staying-clean

EDIT: The article suggests this is more of an issue at the wholesale levels (institutional investors, etc.)

Topic: Interesting CoinDesk about "Dirty" Gold and "Dirty" Bitcoin - page 2. (Read 466 times)