First Bitcoin “mixer” penalized for violating anti-money laundering laws

Re:First Bitcoin “mixer” penalized for violating anti-money ... by freeone3000 on Monday October 19, 2020 @07:30PM (#24832252)

Money laundering does not require the actual source of the money be illegal. You can fall foul of 18 USC 1956 through a.2.B.ii route, where merely deliberately concealing the source or destination is punishable by a fine for the entire amount concealed. a.2.C provides for 2 years in prison if you didn't report when you had to. This is not a questionable interpretation, this is the law as written -- mixing is illegal on its face, no matter the source or destination.

[ Parent | on HN ]

Re:First Bitcoin “mixer” penalized for violating anti-money ... by jl2718 on Tuesday October 20, 2020 @12:19AM (#24833887)

Thank you for the citation, but now that I've read the law, every section in here seems to require that at least part of the money is proceeds of unlawful activity: https://www.law.cornell.edu/uscode/text/18/1956

[ Parent | on HN ]

Re:First Bitcoin “mixer” penalized for violating anti-money ... by freeone3000 on Tuesday October 20, 2020 @01:56AM (#24834307)

Those clauses are joined by an "or", not an "and". One element alone is enough to satisfy.

[ Parent | on HN ]

Re:First Bitcoin “mixer” penalized for violating anti-money ... by jl2718 on Wednesday October 21, 2020 @12:59PM (#24849727)

Wow, okay, so pawn shops too I guess: https://news.ycombinator.com/item?id=20602562

If reporting is already required for all cash transactions, then certainly it will be built into the digital USD.

And Monero miners would have a problem here too. KYC required on every transaction in every block.

Okay, so, what if you did KYC on all the inputs, but you ran a mixer such that the outputs would be obfuscated? Is that legal? What if you take outputs from a set of those mixers? Is there any legal way to provide irreversible privacy for known legal sources?

[ Parent | on HN ]