That’s media sensationalism. BTC is not remotely anonymous and is useless as a tax evasion mechanism. Your money still has to go through someone to turn into BTC, and that’s the same as any other money laundering operation. Once their books are audited, your “safe haven” is worth nothing.

I don't completely agree, you can move BTC around, mix it and exchange it for other cryptocurrencies while leaving only a very small trail. You don't have to involve other people directly, you don't have to carry duffel-bags of cash across borders etc...

Of course if your money starts in your "books" before being converted into cryptocurrency then yeah, it's useless. But that's not the use case, it's more about laundering money that's not in the books to begin with (corruption, black market, undeclared sales etc...).

I believe that right now the main deterrent to this scenario is the same reason people don't use cryptocurrencies for legit use cases: it's wildly unstable and you have to convert it to dollars or some other "fiat" to do anything with it.

If you got the bitcoin originally through mining, then it never has to be converted from another currency. Bitcoin is anonymous, but only if you mine instead of purchasing on an exchange.

The only transaction that is going to appear is currency->BTC. After that, there are many efficient ways of obfuscating a BTC->BTC transcation. There are legitimate uses of BTC, so nothing necessarily suspicious.

However, if you want to receive bribes, you just create a new wallet, you receive the bribes in BTC and either change them somehow in dollars or pay a premium to receive some services directly paid in btc (I am sure many people would be happy to receive BTC payment at a 30% discount).

Tax evasion works the same: you receive some payments that you do not declare in BTC. It works exactly the same way people use cash to evade taxes, except that here you don't have to transport luggages full of banknotes.

Another feature of BTC is that it can't be seized. Cash, gold, paintings, they all can be. BTCs are much easier to protect.

Vice has a good video on drug dealers lining up to use a Bitcoin ATM every day somewhere in an American ghetto. Bitcoin is 100% about drug dealing, gambling, and tax avoidance.

You would have to be a total moron to go through all the hoops to use it otherwise. Its kinda like running desktop linux in that way.

A lot of Bitcoin volume is criminal in nature. What is contested is that a large fraction of criminal fund flows go through Bitcoin.

For the same reasons it sucks for individuals (volatile, slow, expensive, publicly recorded, difficult to spend and difficult to convert), it sucks for criminals.

> You would have to be a total moron to go through all the hoops to use it otherwise. Its kinda like running desktop linux in that way.

So, what, you'd have to be a total moron to go through the hoops of installing Linux as well? Do you think before you comment?

Your 100% figure is wrong given that I, at least, don't match any of your description. You can't go around claiming this kind of nonsense.

In most countries there are no hoops. In most places in Europe it's harder go get a bank account than to get bitcoin. Does that mean only morons go through all the hoops of obtaining bank accounts?

Do you have any sources for your claim that Bitcoin is used for large Russian/Saudi assets? It seems like the volume of BTC traded for illicit purposes is large in aggregate, but I'm not sure I've seen evidence of individual transfers being big. There are many ways that bad or unscrupulous actors can transfer money now that are actually less risky than Bitcoin.

I'm not commenting on the use of Bitcoin for Russian/Saudi interests, simply some information on Money Laundering and Terrorist Financing.

Money Laundering tends to be smallish sums deposited over time, resulting in large amounts. You can't wash 100MM in one go.

Terrosist Financing tends to be a very large number of small transactions from multiple global sources in a very short space of time into one account/wallet/location. Like crowd-sourcing, in fact exactly the same as crowd-sourcing.

Less risky than Bitcoin? In the end you have to get it out of the blockchain to be useful, so that's where the pointers from a law-enforcement perspecive are.

I have zero interest in Bitcoin, but the idea that terrorists finance happens through cryptocurrency is very naive. Terrorism is sponsored on the ground, with goods, not money that you have to convert to some other money first, and then buy things you need.

This is correct. International funding does happen. Funds travel across regions, countries, territoritories, very quickly, to enable the passing of goods on the ground.

Look at the BTC price fluctuations when another round of sanctions is added on Russia, when Cyprus cracked down on tax evaders or wduring the Saudi corruption crackdown. Everytime it peaks.

A rather odd tool for tax evasion that has a record of the evaded tax for all eternity.

It is vastly easier to launder money through regular channels than through a method that by it's definition records every transaction.

> BTC would exist without the cultists as long as Russian or Saudi assets need to be transfered without too much oversight

Liquidity, though.

Exactly: No crypto in it's current state is liquid enough for any serious moving of money. Slipping, fees (and potential hedging costs) will eat you if you need to to move serious money.

As such it only works for entities who don't have vast amounts of capital, eg. people who can't afford an army of tax lawyers to create complex legal tax evasion schemes to pay less tax than the rest of us.

"No crypto in it's current state is liquid enough for any serious moving of money"

It's more liquid than real estate, which is widely used for money laundering.

I don't think so. If someone put 5K BTC up for sale on one day the price of the whole market would be disrupted, but similar sales happen in London and New York every day and the market seems unbothered.

> If someone put 5K BTC up for sale on one day the price of the whole market would be disrupted

https://techcrunch.com/2018/01/15/researchers-finds-that-one...

If I'm moving stolen money (or magic math coins or whatever) I don't give a damn about the fees - it's 100% profit either way. It costs money to have it laundered, whether that goes to a shady lawyer(s) or a Bitcoin processor who cares, it doesn't matter it's all profit for the thief.

> I don't give a damn about the fees - it's 100% profit either way

If I worked in your criminal enterprise, I'd could tell your deputies "look at this chump, throwing money away. I'll hire trucks to haul cash and boost our profits by 20%. Help me 'replace' the leader and I'll split those gains with you."

That's not how dirty money works if you want to get away with it. You need to launder it -- put it into something legitimate and, most importantly, get something back out of it that looks legitimate enough to pass casual scrutiny -- for this service anything and anyone, legit or not, is going to take a cut (or "fee"). It's the cost of doing criminal business. And if you're in a criminal enterprise and you even talk to the other members of the ent. about how you're going to move your money you ain't gonna be in the enterprise very long. That type of dirt you do by your lonesome or you die.

Needing to pay fees is different from not "giv[ing] a damn about the fees." I understand I have to pay a broker's fee when I buy and sell stock. That doesn't mean I'm indifferent to its level.

Using Bitcoin to surreptitiously move large quantities of funds is almost always riskier and more expensive than traditional money-laundering techniques.

And how may I ask did you come to this conclusion? Have you ever actually laundered dirty money?

> Have you ever actually laundered dirty money?

No. My knowledge comes from anti-money laundering training.

Depending on how fast one needs to move, money laundering fees go from 5% to 30%. Bitcoin is cheaper than that per se. But include the costs of anonymising and cleanly cash out, and you're just adding cost and risk over a wire transfer between fronts.

No man, there's so much more exposure that way. And remember, this is a criminal enterprise. Those people who run your fronts could just as easily rob/kill you and take it for themselves, and given the chance they will. With bitcoins you can 1) do it yourself, no middlemen other than the bitcoin processor who doesn't give a flying right-hand fuck where the money comes from, and 2) do it far, far, far quicker than traditional methods. A thief isn't going to give a damn about fees, I'm tellin ya, in the end it's all profit for them. Get in, get it, and get out. If I hit a lick for $100k, flip it in a couple days while interacting with not another soul but lose 30k to fees, I'm still up 70k that's a good lick. and if I paid the 30k to not have to deal with ANYONE face-to-face (least of all other criminals) that's worth it in spades because I'm not spending MY 30k, I'm spending YOUR 30k.

> if I paid the 30k to not have to deal with ANYONE face-to-face

How do you propose cashing out? Your cronies aren’t going to want their wages in Bitcoin.

> I'm not spending MY 30k, I'm spending YOUR 30k

Practically speaking, if you steal my money it’s now your money. More money is better than less money. In any enterprise, criminal or legitimate, there are systemic incentives for maximising pay-out.

Conversely, if you steal my money and then interact face to face with someone else in the transaction the money potentially becomes seen as their money and you are seen as an overhead at best. I am irrelevant. You may become irrelevant.

The one thing that’s quite obvious from your posts is that you have a very, very loose grip on basic business and economic principles.

>Bitcoin is a tool for tax evasion and money exchange on criminal assets

You just made it more appealing and useful, since taxation is theft. Some "criminal" assets are incorrectly classified as criminal, so that's another +1 for Bitcoin.

Would like to read more.