If it wasn't so sad it would be funny that the countries with highest levels of freedom and least corruption tend to be the ones with most vocal privacy absolutists...
Correlation or causation?
My point is that the most powerful countries don't need to clean their dirty money to spend their money abroad, because they are the center of the world economy, and everything is available to them to buy. Russia is economically on the periphery and thus does need to clean it.
If 99% of Tor's volume is helping laundering international drug trade money, distributing CSAM, etc, should it be demonized as well?
You can apply basically the same argument to money. If I have $20m in Bitcoin I don’t want my name to be tied to my wallet address (because a KYC exchange saw where the money went to) because it makes me a target, for example. And in the case of censorship or something I want to be able to do with the money what I please.
Privacy is a fundamental human right, in my opinion. We have to use cumbersome technology to get any modicum of true digital privacy. Just because people use it for illegal things doesn’t mean that the desire for privacy or the technology itself is bad. One day things we find morally just may be illegal too
Intentional consealment of illegal financial transactions is a crime in-and-of itself (the crime is money laundering, which is a seperate offence to the original criminal activity that the money came from).
In both situations using it for legal purposes is legal.
But the ‘illegal’ scenario is different as money laundering is a crime on its own, while “laundering internet traffic” is not a crime.
It’s a bit like a pharmacy that also dispenses heroin to kids - it doesn’t matter that the legal drugs are being sold, selling crack to kids is illegal by itself.
Easy answer: Yes! Although I think it would be hard to call it demonizing when something is already 99% demons.
All I'm saying is that if there's something where "99% of [...] volume is helping laundering international drug trade money, distributing CSAM" that that is obviously terrible for the world and we should be asking some strong questions about who's supporting it and why. Is somebody gaining something that's more important than the lives forever ruined?
https://www.cnbc.com/2022/08/10/crypto-criminals-laundered-5...
Is $540M considered a tangible amount? I'll let you quibble over that but I'd think most criminals would be more than happy to be able to launder $540M.
If you made it this far, then you start the laundering process.
You can't launder money with Bitcoin because Bitcoin is not well integrated with any country financial devices in any meaningful manner.
Scenario two. I want to have on-chain identity (e.g. exo762.eth domain name). To register it I need to have some ETH (gas, registration fee). If I sent this ETH directly from my "money" account, I will forever link my public identity to my money, which is like walking around with "my net worth is at least XYZ USD" banner.
We're in a thread about a rogue state using the tech to steal money to fund their operations (Chemical attacks in airports, nuclear warheads, intercontinental ballistic missiles, etc.) How many nuclear detonations would you consider acceptable in exchange for the cryptobros to have their toys?
We've come a long way from Mario Bros!
https://www.bbc.com/news/stories-57520169
More prosaic wire fraud is common in real estate and B2B transactions, and if not noticed immediately the funds are often lost after being transferred internationally and cashed out. It wouldn't be surprising if NK is behind some of that, given what they managed against Bangladesh.
I would also suspect that using data collected by governments is used for business advantage. Of course it is hard to prove quite often. Personally I think that in principle it just doesn't make sense to spread your data around, as the benefits are tiny and the potential downsides can be big.
Basically if you were high profile enough, people would watch your wallets to see what you were investing in/transacting with, and use that as market intelligence.
As far back as 2016 or so I recall someone specifically offering their blockchain analysis platform as a way to do this.
So you would use tornado to make the money you planned to invest/use appear "somewhere else" disconnected, to maintain privacy/security of a project.
Tornado and mixers and such become necessary specifically because all transactions are public - unlike in tradfi where transactions are opaque except to parties and intermediaries.
Similarly to how investors in tradfi tend to keep their investment strategies secret where possible.
For example, library records generally have a fair amount of privacy. Criminals sometimes consult libraries. Crime is not the dominant use of libraries.
Mixers have a fair amount of privacy. Mixers are used by criminal, and crime is overwhelmingly the dominant use of mixers.
To rebut this you’d need to show large and innocent use cases which use mixers. Not an unrelated app.
Yes.
It’s definitely usable for non nefarious activities.
Should I be demonized for having one in my house?
Probably
Because we don’t, and there is considerable friction required to have financial privacy, most people don’t bother unless they really need it or are unusually privacy conscious. Really needing it may often mean they are doing something nefarious.
That doesn’t mean the technology to enable privacy is “bad”, it means it’s too hard to use and that as a society we have done poorly at guaranteeing people’s right to privacy.
Not so long ago you might have ben able to say the same thing about people communicating with end-to-end encryption, but thanks to a concerted effort to improve the UX of this tech. and it’s adoption by some very widely used services, it’s now commonplace. End to end encryption could no longer be argued to be mostly used by criminals.
Hopefully we will get there with financial privacy too.
NB: in neither case am I suggesting that the government should be unable to require you to provide information in some situations (or face the consequences of withholding it against, say, a court order), only that dragnet surveillance of everyone by default is never acceptable.
Unfortunately I'm a normal person with my primary/only income being my salary.
I benefit from this 100 times more than not.
I can't and won't do tax evasion. The rich and bad do.
This left only the bravest parties, and criminals to use it, leading to a high proportion of users being criminals.
If it weren't for that uncertainty about the legal treatment TC would receive from government (say if Congress passed legislation explicitly providing a right to use financial privacy technology), a huge proportion of the whole crypto economy would have been using Tornado Cash, as they should be, because privacy is an absolute bare minimum for a functioning financial system.
The conceptual treatment you're giving transaction encryption is to treat privacy as criminal. This is an ideological outlook that promotes putting total trust and faith in a small elite in government and finance to engage in warrantless dragnet surveillance of every one's financial transactions.
One of the more recent difficulties with a lot of privacy technology is that the main user might not be the abused and those wanting to avoid being abused, but instead... really awful criminals.
And with anything cryptocurrency or blockchain in the last decade, it's not only the users who are criminals, but much of the technology itself is built by scamming atop scamming.
I'd quibble with any article today that mentions cryptocurrency/blockchain at all without acknowledging how sketchy the entire space is.
Pre-Web cynical cyberpunk writers were better at predicting much of the modern world, than were the optimistic techies who mostly saw tremendous opportunity for goodness.
I have a quibble with articles about cryptocurrency fraud. They always get around to mixers and then they define it as if it were some relatively legitimate thing, like an odd bank. "large digital pools", "deposit funds". You have to get to the last phrase ("obscure their origins") to understand what mixers really are.
A proposed alternate definition: "mixers - international money laundering services where illegally obtained cryptocurrency can be mixed with other fraud proceeds making it harder for the legal system to trace".
(The definition I really would like: "mixers - services that look to hide your funds but are actually operated by intelligence agencies to track illegal activity". I imagine at least one mixer is a honeypot of sorts.)