Topic: Is bitcoin just for criminals and terrorists? - page 2. (Read 10418 times)

Silk Road takes deposits on their site, which winds up being a concentration point of illegal activity.  It will show up quite clearly on a heat map, and could potentially be identified by depositing and withdrawing a certain amount of tracked coins, at certain intervals.  A tech-savvy cop buddy could observe (a) bitcoin-like network activity at Bob's house, and (b) a flow towards the Silk Road "concentration" in the block chain.  Observe several data points over time, and you can build a decent body of data evidence.  Or simply observe Bob's web browser and BlahBlah Tor Site generating network activity at similar moments.

Serious anonymity takes a lot of work, and is darned near impossible if you are making a "noticeable" impact on the network, with your activity.

New users should get into bitcoin with their eyes open. Various amounts of tracking are already done with cash-purchased prepaid phones and debit cards.  If it's an electronic record, it can be data mined for patterns of money flows.  The government is quite skilled in picking signal out of noise, even encrypted noise.

This is true, but it doesn't change anything.  You can search your own addresses and see what you paid for because you have the secret knowledge necessary to make sense of that info because you were the one who did it.  Give those same addresses to your cop buddy, and send him to the blockexplorer site, and ask him if he can figure out what you bought or from whom without your help.

Your local wallet's addresses can be explored on http://blockexplorer.com/ just type one of the addresses you recently sent coins to in the box and click on the addresses in the table to explore.  Also:

http://forum.bitcoin.org/index.php?topic=11134.msg158948#msg158948

Quite true.

Though, bitcoin users should keep in mind that any gov't tracking usage patterns of "anonymous" VISA debit/gift cards is going to turn around and use exactly the same statistical analysis and tracking technology on bitcoin.

Bitcoins are easier to track than paper dollars, that's for sure.

Money laundering seems custom made for a good p2p app. I'm sure these will make an appearance at some point. Bitcoin is just the beginning, a whole economy will grow up around it.

Well, alot of people are finding out about bitcoin from articles that are being written about ' Silk Road '.  So, the ignorant masses are seeing that and associate bit coins w\ buying illegal things online so that it can't be traced.

Which is what some people do!  but, that's not what bitcoin is.

Perhaps.  It's a good reason to be suspicious of using an online wallet provider if one intends to do anything that would get your government upset, but for the kinds of trades that one would use paypal for, mybitcoin.com is ideal.

Well then the legalized framework is in place for that aspect through international treaties.

Yes, if legally ordered by a court in New Zealand.  How responsive NZ's legal system to the want's and needs of other nations remains to be seen.

Check mybitcoin.com 's terms of use.  They keep extensive records and will be sharing it with whomever if legally ordered.  Laundering bitcoin is not an inherent feature of bitcoin.  It is a willful act.  Laundering bitcoin or cash is illegal.  You will however easily be able to proof where you got your bitcoins from through the publicly available transparent blockchain. Buying digital goods and services is not always illegal.  Depends on what it is.  May Bitcoin DIGITAL RIGHTS TO CRYPTOGRAPHIC KEY CERTIFICATES (backed by a capital intensive network of machines securing this) be transferred, bartered, bought or sold? Is there some law forbidding this?

Yes, that is the whole point.  It's true that payments can be tracked from a known user to other known users, and in this manner establish a chain of custody.  The problem for LEOs is that establishing a trustworthy link between a bitcoin address (or even an online identity and a real world identity, as one particular government contractor found out to his own detriment recently due to trying to link members of Anonymous to real users on Facebook) to a particular person or organization is not trivial.  And this issue become more difficult with the increase in data set size (the number of bitcoin users) and economic velocity (how fast the currency travels from one person to the next).  So the difficulty that LEOs will have is that they literally will not be able to maintain the resources to pursue all these avenues of activity.  Only the most important (in the eyes of government) activity to prosecute will be actively tracked, which in practice means "terrorism".  The units with the budgets to actually figure who owns which bitcoin address will not care about some random geek ordering LSD for a rave.

It's not saying anything that https://en.bitcoin.it/wiki/Anonymity doesn't already say.

Modern network flow analysis means you can glean a lot of watching encrypted conversations.  Even without the plaintext, you gain a lot of data about timing, length of the conversation, etc. from observing the bursts of data, over time. It is easy to extrapolate that to bitcoin.

Bitcoin is so open that it's more open than the [partially shadowed] banking system that currently exists.  Our P2P network provides much more open source intelligence than the banking community volunteers, I'm betting, and on a more real-time basis.  Banking systems, no matter how much privacy-killing identity data they dump to the gov't, tend to be slow, often giving the appearance of immediacy by creating a book entry at transaction time, yet handling full settlement in large batches at a later time.

Further, Bitcoin is also so small that large or consistent flows of money are more readily visible, no matter how much mixing occurs; large ripples in a small pond.

So I will always object to calling bitcoins "anonymous, untracable money" because in reality, bitcoins are slightly less anonymous and more traceable than [paper] US dollars.  Telling new bitcoin users that it is anonymous and untracable is quite misleading, because most new users will not take inhuman precautions to make it so.

What makes bitcoins interesting are their global nature, fixed money supply, low cost, and instant transactions.  Anything with a globally public log is going to require a lot of work to be truly anonymous.  Most people won't meet that bar, and probably don't care to either.

The argument that 'every transaction is in a public log' therefore criminals can be tracked is ridiculous. Anyone with enough sense to use bitcoin who wants to cover their tracks can easily use mtgox/mybitcoin other ewallet providers as mixing agents and end up with 'clean' coins (assuming they received 'dirty' ones from a Justice department sting operation trying to trace them or something).

i'm sorry - i wasn't really intending to be flippant.

but the facts are that Bitcoin will be very useful to everybody.  bad guys (however you care to define them) included.

the point is that it's just a currency.  it has no moral or ethical attributes.  and no impact at all on what people choose to do with their lives - for good or ill.

To me, Bitcoin is exciting precisely because it lets you do things the government doesn't want you to do. Isn't that the whole point?

Pleeeeease... just for the sake of argument?  Just so we all have a common ground from which to build our argument that bitcoin will not be useful to the bad guys?

mmmph.


there is no such thing as both honest and law-abiding.  laws are designed such that people cannot avoid breaking them - and most especially when endeavoring to maintain rigorously honest relationships with other individuals - thusly ensuring the 'right' of the state to do whatever it would like with its citizens.

so yes then - Bitcoin is just for criminals and terrorists.

Just for the sake of argument, let's use "The Law" as our yardstick.  The point of this is to counteract arguments that attack the validity of bitcoin in an honest law-abiding world.  Therefore, we must show why any entity that uses bitcoin specifically to circumvent the law, runs a risk not presented by traditional currency or assets.

Maybe he wouldn't  but you make a good point.  The informant or insider might still be a valid possibility.

if you would care to clearly and unambiguously define:

1.) the differences between criminal behavior, immoral behavior and illegal behavior, and

2.) the point at which a terrorist campaign (see: U.S.A. ca. 1770-1779, or Israel ca. 1947-50) becomes a heroic effort by the good guys

...i would be happy to reply.

Why would a geeky teenager stop at stealing just a "C&TO" wallet.dat?