Real dangerous criminals don't give a damn about KYC/AML laws and operate freely within the banking framework. The European Central Bank chairwoman is a felon convicted for massive government payouts.
Why do people feel the need to deliberately mislead by leaving out all the important details? I had no idea what you were talking about, so I looked it up, it's the second item under https://en.m.wikipedia.org/wiki/Christine_Lagarde#Controvers....
Regardless of your opinions on that particular court case, or the fact that the letter of your statement may be true, do you honestly think "The European Central Bank chairwoman is a felon convicted for massive government payouts" would give the average reader an accurate view of what happen? Because after reading what actually happened, and which IMO comes nowhere near to the deliberate malfeasance you imply, I just conclude that, to put it colloquially, "You're full of shit."
absolutely. Your wikipedia link is absolutely clear :
"the court found Lagarde guilty of negligence"
So, she is a convicted felon for conveniently looking the other way. Some of course may question whether the 400M euro is "massive" these days...
P.s. "My currency is signed by my own private key, yours - by a convicted felon". Whom would you trust more?
P.S. Also, how come you can use such language ("You're full of shit.") and not be banned? Could a moderator take a stance on this one? I don't see the flag button for some reason.
If KYC/AML is not possible in the bitcoin world, you're not going to be getting a world with bitcoin that doesn't have KYC/AML.
You're going to get a world with no bitcoin.
The real analogy here is that the ultra rich needn’t deal with the TSA because they fly private.
Just because the response is a bad one doesn't mean that the problem doesn't exist.
FWIW, even if TSA is bad at stopping terrorists, I AM glad that all of these people punching flight attendants are, with certainty c. 1, not packing heat.
Seriously, how often does this happen? I've flown a fair amount in my life (in Europe though) and I've never seen any commotion on a plane. I've read about some incidents, but I've read about a lot of fucked up stuff that I'm not concerned about in my life.
It's along the lines with everything these days. Someone does something bad and someone else gets shocked and then everyone wants to stop something like that from happening ever again, through whatever means, without realizing the incredible inconvenience (and complexity) this causes over time when repeated ad infinitum.
If only 1% of those people were armed, that would still be very very scary!
Of course there's also nothing stopping you from sending your coins somewhere with reduced reporting and spending them from there, but then there never really was in the first place.
Allocation of resources to try and ban cryptocurrency (or encryption in general) is probably one of the dumbest things ever conceived, probably even more so than the drug war.
Bitcoin is designed to be fungible - it's digital cash.
BTC has a history, so if I had 1 BTC, and you had 1 BTC, they wouldn't be equivalent.
When you deposit BTC into a Coinbase account from a gambling site, CB shuts down your account. That is irrefutable proof that BTC is not fungible.
Compare it to cash which is fungible. If you win money at a casino and deposit it at a bank, the bank doesn't know where you got the cash from.
You're off base here. There's serial numbers on money and many databases maintained both public and private meant to track those and flag inflows of marked bills. The bank absolutely might know where you got the cash from -- the difference is that there are legal guarantees for the fungibility of cash. It is enforced by law that if someone pays you a dollar, you are legally obligated to accept that as tender. For all debts both public and private.
The fungibility of the dollar is not rooted in lack of ability to track dollars, it is rooted in state violence.
Anyways everyone should use Monero. BTC is obviously far less fungible than a dollar.
People have been yelling about this all being made illegal for literally a decade, and it hasn't happened yet.
Of course, you could not do all those things...but it would be just as illegal and lead to you being just as in jail (and your assets seized) as it would for any other currency.
So sure: technically you can hide a bunch of stuff with BTC, but you can do that with USD just fine too (cash is pretty untraceable). The moment you get caught though, you're just as screwed.
Of course crypto privacy features are not going to be made illegal. That was my entire argument. Crypto has been around for a decade, and lots of privacy coins exist, and are not illegal.
Therefore, other crypto features that make KYC more difficult are also not going to be made illegal.
We should stick with USD. No one does anything illegal with USD
Way to skip over the different potentials for abuse and just dive to the cryptonerd's handwaive argument.
Looking forward to your insights about rubber and glue.
The claim wasn’t "BitCoin is for illegal things (and by comparison, USD is never used for crime)", it was "BitCoin's lack of support for KYC makes it more likely to be attractive to criminals and therefore likely to have its use criminalized" which you CAN'T just hand waive away.
this is not even worth looking at compared to other money-related crimes (just new and in media so people are scared)
means different things in different places
> made illegal
it's already illegal here and there
BTC is built to not support KYC/AML.
Just because you don't technically have a problem doing something now and no one is complaining, doesn't mean there's not a drastically more efficient way to do the thing, and those organizations that start doing the more efficient thing rapidly out compete and make irrelevant those who hold onto the legacy ways.
Probably unknowable but I wonder what has caused more damage to the world, financial crimes or centralized financial levers being used to steal the time/savings/wealth of 8 billion people and redistribute it to a small group of people.
Also,
- $1.9B in crypto currency stolen by hackers last year [that's known about/reporter]; https://www.securitymagazine.com/articles/94627-19b-in-crypt...
- Bitcoin extortion: How cryptocurrency has enabled a massive surge in ransomware attacks (Crypto revenues from ransomware surged more than 300% in 2020 from the year before) - https://www.marketwatch.com/story/bitcoin-extortion-how-cryp...
How does that criminal activity keep scaling? And you do you think criminal enterprise won't target to infiltrate organizations who hold large amounts of Bitcoin et al to infiltrate to steal the keys to the vault? Then the only way to counter that is centralized database/service to check all transactions through to make sure the funds didn't originate from criminal activity, and then centralized authority for enforcement, etc.
Bitcoin Maximalists or crypto-"currency" enthusiasts skip over, don't respond to such criticism as it doesn't fit into their glossy propagandist narratives that Bitcoin etc al are godsend - they keep the scope of conversation and talking points narrow or cordoned off - which is super obvious with most Bitcoin spokespeople, though the most popular are intelligent ideologues who speak beautifully, poetically, in inspiring way that's motivating - but still lacks the rigor of challenge by peer confrontation; Jordan Peterson recently had a popular Bitcoiner on to speak, it's good he's diving deep into it, let's hope he doesn't get too indoctrinated into an imbalanced/out of balanced doctrine spread by financially motivated individuals; imagine if being part of a religion and proselytizing was financially advantageous - where the earlier on you're in on the pyramid (with contributions to the church to "show your commitment") lead to a potential windfall or promise of such if and once everyone in the world is part of that religion/cult.
Perhaps the primary output of bitcoin will be that it lights a fire under the lazy ass of government to actually have a service mindset towards people, because they now have an alternative that they can use however they want.
We'll see.
The complains are about the "buy now pay 90 days later" part, not about the actual money transfer.
I would imagine the suppliers of Wirecard do see it as a problem that the $2B WireCard said it has in the bank did not exist. In a blockchain setup, they would have known it.
Ducking for "supplier" and "insolvency" brings up quite a lot of stuff about this topic:
And if you think that you can "lock bitcoin" into an account to avoid this, you obviously don't know much about how these things work. Hint: you can also "lock dollars" today, it's called "escrow". But it wasn't used in WireCard (I take your word for it, I don't know the case).
Explained like I'm five: BMW will not accept it's bitcoin being locked for 90 days, so that it's supplier can be sure it will receive it's pay. Because if BMW would have accepted such a thing, it would pay today, not 90 days later. So crypto doesn't solve any problem here, because BMW doesn't want this problem solved.
And today, the supplier would use "factoring" so that it can receive the money instantly, instead of 90 days later, and the bank which provides the factoring service will make sure to take it's money from BMW later. Hint: you need capital to be able to provide factoring, since it involves credit risk, so crypto can't replace that either directly (it could with some fancy smart contracts that pool liquidity and yield)
BMW will not accept it's bitcoin
being locked for 90 days
Usually, one is "paid" when "the money is in the bank", right?
And this is what happens here. The initial step is to create a bank and then "payments" happen there.
As for how to pay someone who is not "customer" of this bank, see my answer to this question:
https://www.techtimes.com/articles/263185/20210721/elon-musk...
Tesla also holds bonds and other stuff that pays a dividend.
When Katy wants to pay ₿3 to Billie, Katy just sends a key (via email or some API) to Billie which enables Billie to withdraw ₿3 from the account of Katy. But Billie does not do that. Billie just keeps that message like you keep your login to your bank account.
When Katy wants to pay another ₿5 to Billie, Katy sends a key to Billie which enables Billie to withdraw ₿8 from the account of Katy.
Now Katy paid Billie ₿8 in two transactions. All via email, letter, telephone or - most likely - API. Nothing at all happened on the Bitcoin network.
In other words, Billie has no guarantee that the key she holds will be valid tomorrow; Katy could empty that account at any time, and Billie would then hold nothing except the evidence of Katy's wrongdoing.
This function is provided by script: https://en.bitcoin.it/wiki/Script
they are locked down. the funds in a lightning channel are locked in a 2 of 2 multisig address, and can only be moved upon mutual consent (ie. by updating the state of the channel), or by one party after sufficient time has passed (in case of an uncooperative peer).
OP was describing something in the context of Taproot and now you and others are talking about Lightning. What is the new development here?
https://blog.chainalysis.com/reports/bitcoin-taproot-upgrade
https://medium.com/blockstream/taproot-activation-enhanced-t...
Are you talking about compared to regular transactions, or because network fees (per byte) are high?
That $1 enables as many transactions as you want between party A and B, of which party B may have dozens of open channels with other nodes to facilitate routing from party A to C etc.
Katy could empty that account at any time
Realistically, the spending conditions are either limited by time. So Billie knows she needs to withdraw until a certain date or Katy could betray her. Or the spending conditions contain a punishment for betrayal. So if Katy tries to withdraw money she assigned to Billie, Billie can intervene, get her money and punish Katy.
Isn’t this an example of a centralized bottleneck?
Roughly speaking the Lightning Network works similar to a „current account“ that businesses have between each other but does not require the actors to trust each other. The parties initiate a transaction by each one sending Bitcoin to a public multi signature address. The resulting transaction cannot be spent by any one alone. Now, this unspent transaction serves as an initial balance and opens a channel between the parties on the layer 2 network. Bitcoin may now be wired back and forth between the parties on layer 2 w/o needed to be settled individually on the Bitcoin block chain. Finally, if all parties agree by signing a second, settling transaction the resulting balance is written back to the Blockchain to whatever address the participants initially agreed upon. Theoretically, there could have been billions of Bitcoin transactions over the years on the Lightning Network which would be eventually represented by only two transactions on the chain.
Now, taproot improves this scheme by introducing Schnorr signatures. Up to now every member of the multisig transaction I just talked about needed to contain the public keys of all parties which in turn needed to be verified against all their private keys. Since transactions are limited in their size, this limited the applicability of multisig transactions. Now, Schnorr signatures allow for aggregation of public keys so the transaction only needs to contain a single number instead of hundreds or thousands. Of course, this also speeds up validations of transactions.
I hope this all made sense. I have yet to see practical applications of a Lightning Network „scheme“ but I heard El Salvador is using it for cheap Bitcoin transactions (although not applying Schnorr signatures yet).
I do wonder how it could ensure the code running is the actual code signed for as its hash would be different though.
At signing time, the signer reveals a hash for every non-taken branch, so that the commitment still checks that leaf being executed was an admissible one.
The dead-code elimination goes further than that, because at the top level this hash root is hidden inside a public key which can be a key controlled by all the participants jointly (or some subset if appropriate). At signing time if these top level parties are available and cooperate they can just sign, and no script is ever revealed, it's impossible for third parties to tell it was ever there-- saving resources and preserving privacy.
(And the possibility to complete the transaction using the script means they don't gain from failing to cooperate)
Parent talks about the „Lightning Network“
So is the "BMW and its suppliers" network I imagined. But this network is simpler and more customized to the needs of this particular use case.
Of course using the LN would be a viable alternative to a custom solution.
You'll need to have a revocation mechanism to punish older states being put on chain. That may not be so simple when (many) more than 2 parties are involved.
> Or it could be "BMW did ten thousand transactions with its suppliers". You don't know.
Amounts are still visible as well as number of entities paid by the settlement. Recipients may become identifiable through follow-up transactions or re-use of known public keys.
> And all of the transactions were free
All but the initial funding tx and the final settlement tx.
Yes, the initial tx and the final tx will provide data for forensic analysis.
Yes, the initial and final tx need some time to settle (something like an hour) and cost some money (something like a few dollars at current rates).
Also, if I’m adding a new supplier in this example, do I have to spin up an entirely new “virtual bank” to do so? Or can I just add them to the current one? What is the user experience there?
Also note, as exemplified by altcoins it is always possible to trade off decentralization or security for more features.
Probably should just use Lightning instead?
One is that one of the participants is a virtual bank on its own. This would be similar to the old banking system. How do you send money to someone who uses a different bank? By telling your bank to talk to their bank.
A company could create a virtual bank to handle all transfers with its suppliers by doing a single onchain transaction.
From the outside, it would look like a normal "Someone sent some coins from address A to address B" transaction.
But internally, a key needed to spend the funds is only valid if the company and all of its suppliers sign it.
This means every time there is a transaction between the company and one of its suppliers, the company would send out a signed message with the new spending conditions (the new balance of the company and every supplier) to the supplier network. Everyone signs it and that's it. It does not go on chain.
Only if a participant becomes uncooperative, the latest state will go on chain and everyone will get what they own.
So in the future, two transactions on the Bitcoin chain a few years apart could be "Someone sent something somewhere in December 2021 and then they send something somewhere in June 2025". Or it could be "BMW did ten thousand transactions with its suppliers". You don't know. Both look the same on chain. And all of the transactions were free, instant and possible 24/7.