Bitcoin in a hyperbolic bubble

[tecate]

But we're not talking about hobbyist hackers are we? We are talking about organised criminals who are in it for the money.

Is there such a giant leap from one category to the other? I doubt it. If hackers have wreaked havoc in the past without necessarily needing $ compensation, why should this be any different? Sure, it may not be as attractive in a case where there's no $ to exploit, but it wouldn't stop happening in that instance.
The other point is that a ban wouldn't prevent this sort of thing from happening - so why on earth would anyone go there (specifically for this reason)? Beyond that still, there are other tools - as the writer outlined. Sure, it may be more hassle - but you think that will stop them? I don't.

Adding to this...before the advent of cryptocurrencies, there were hobbyist hackers, but I don't remember criminal ransomware happening much, do you?

My understanding is that ransomware predates crypto. Can crypto be utilised as a tool in such an activity - making the process more seamless? It certainly seems so.

But the article relates to ransomware. Do you know any governments who have engaged in ransomware and seek payment?

You're missing the point. Why not use that guise and throw them off the scent? There was speculation that the group in question was linked to the powers that be in Moscow - I'm not sure if there was anything concrete found to back that up.

One way or another, I don't see these attacks stopping - with a crypto ban or without. How about holding organisations accountable for their network security?

 

[tecate]

@Firefly your last few posts are irrefutable. I've been in similar positions but learnt not to hold my breath for a climb down.

Another member of the anti-crypto quorum chimes in. I'm shocked at your findings Dukey - absolutely shocked.

 

[Firefly]

@Firefly your last few posts are irrefutable. I've been in similar positions but learnt not to hold my breath for a climb down.

You're right..

 

[WolfeTone]

We are talking about organised criminals who are in it for the money

Is bitcoin money?

Or will these criminals convert their newly acquired bitcoin into $$.

How exactly will they do that? Maybe they have cash buyers willing to take the bitcoin at discount? All that means is that bitcoin and cash are as culpable in this ransomware scheme.
Alternatively they could sell their bitcoin on exchanges. But with increasing regulatory oversight on exchanges, a trail will be left.
For example CAB have strong powers to seize assets and property where unexplained accumulated wealth is detected.
I don't see why similar cannot be applied to any wealth accumulated from sale of bitcoin.

 

[tecate]

You're right..

For sure - that's why the New York Times article focuses on network security. Perhaps the writer in that instance doesn't have a multiple year record of opposition to decentralised crypto as you two.
Imagine we have an organisation renowned for mismanagement (HSE) and they're not being held accountable in any way for this incident.

 

[Duke of Marmalade]

Or will these criminals convert their newly acquired bitcoin into $$.

Of course they will, criminals ain't stupid.

All that means is that bitcoin and cash are as culpable in this ransomware scheme.

Please Wolfie this is not about putting bitcoin in the sin bin. It is about recognising the "explosion in ransomware" facilitated by crypto.

 

[WolfeTone]

Please Wolfie this is not about putting bitcoin in the sin bin.

The discussion is based on an article with a headline that says "Ban cryptocurrency..."

 

[Duke of Marmalade]

The discussion is based on an article with a headline that says "Ban cryptocurrency..."

So your point is why aren't they asking for a ban on cash. After all they are both equally naughty girls in this pastime.

 

[WolfeTone]

So your point is why aren't they asking for a ban on cash. After all they are both equally naughty girls in this pastime.

No, my point is that this "ban crypto..." stuff is silly nonsense.

 

[WolfeTone]

Of course they will, criminals ain't stupid.

I'm not au fait with the workings of the criminal underworld, so perhaps this is a naive question.
Can you tell me how criminals convert bitcoin into $$ without leaving a trail?

 

[Zenith63]

Bitcoin jumbler services exist where you send your coins, they get mixed with lots of others and you get out different coins which are no longer linked to the crime on the blockchain. Repeat that a few times then withdraw to cash on exchanges in countries that aren’t too bothered by any of this I guess.

 

[WolfeTone]

then withdraw to cash on exchanges in countries that aren’t too bothered by any of this I guess.

So lack of oversight by nation states and their regulatory authorities on cash transfers from exchanges are facilitating this fraud?

(rhetorical question)
Should we ban nation states and lax regulatory authorities?

 

[24601]

Some of the unwieldy regulatory requirements of 5MLD drove some crypto-based startups out of Europe.

In the US, manuchin wanted to place a requirement on exchanges to get all customers to confirm the ownership of the crypto wallet they move funds to. It was stupidity - as funds can be moved on to another wallet - and another wallet.
This sort of thing - the powers that be having their control challenged - is going to be central to the back and forth on regulation over the next few years. They can ban it - or take a really hard line - and drive the innovation that's coming with it out of the country. That's the bind they find themselves in.

A couple of years back, someone here mentioned that crypto would have to fit in with regulatory frameworks designed for traditional finance. That is what many agencies have been trying to do but it won't work. Regulation will need to cater for crypto rather than trying to force compliance that's ill-fitting.

Having read this I'm fairly convinced that one of the key battlegrounds for Bitcoin and cryptos in the coming months and years will be the AML arena. You seem to frame this purely from the perspective of the powers that be having their control challenged but there is a strong societal interest in minimising criminal activity. It seems money laundering, and by extension terrorist financing, can be facilitated far easier via cryptos.

I don't think they'll really place much value on the innovation element if organs of the state are falling victim to ransomware attacks every other week or losing out on huge amounts of tax revenue. Regulation catering for crypto will lead to the Wild West.

 

[tecate]

Having read this I'm fairly convinced that one of the key battlegrounds for Bitcoin and cryptos in the coming months and years will be the AML arena.

I agree that there's going to be plenty of back and forth on regulation going forward. They'll flip flop this way and that.

You seem to frame this purely from the perspective of the powers that be having their control challenged but there is a strong societal interest in minimising criminal activity. It seems money laundering, and by extension terrorist financing, can be facilitated far easier via cryptos.

We all have an interest in minimising criminal activity. However, AML policy has proven to be an epic failure - and one which comes with a societal cost in terms of trampling over peoples privacy, causing friction in finance to a point where it holds back innovation and it all comes with an incredible financial cost - that one way or another, we all pay for. The world functioned just fine without it - and it can do so again.
On the suggestion that crypto facilitates illicit trade much easier or to a greater extent than fiat cash or electronic fiat - that's incorrect. It may offer advantages to such activity in specific circumstances. However, likewise so too do cash and electronic fiat.

I don't think they'll really place much value on the innovation element if organs of the state are falling victim to ransomware attacks every other week or losing out on huge amounts of tax revenue. Regulation catering for crypto will lead to the Wild West.

This specific organ of the state has fallen victim yet again to mismanagement. That's what needs to be tackled. Bitcoin leads by example as a network that over the course of 12 years has never fallen victim to any attack. As regards the innovative end of things, some will recognise it and some won't. The yanks benefited greatly by allowing the last wave of innovation to develop openly whilst the Europeans and others got it wrong. Some will embrace it and some wont. Many of them will change tack back and forth as they go along and as this unfolds.
As regards your dismissal of regulation needing to be shaped around crypto, there has to be a recognition that its entirely different. Existing regulation was designed for something entirely different.

 

[DublinHead54]

Don't coinbase adhere to AML rules?

Given that even if criminals receive their proceeds in BTC they need to convert it to BTC via an exchange. So AML is still always going to be involved in Crypto.

 

[Zenith63]

Don't coinbase adhere to AML rules?

Given that even if criminals receive their proceeds in BTC they need to convert it to BTC via an exchange. So AML is still always going to be involved in Crypto.

You don’t my have to use an exchange though, and even if you do you can choose any exchange in any country regardless of whether those countries enforce AML.

You can create a Bitcoin ‘account’ (wallet) on your PC without any interaction (without even an Internet connection) with an exchange or other body that will do KYC/AML and people can send you Bitcoin. Send your bitcoin through a tumbler service (no AML being done by these folks!) and it pops out the other side clean and untraceable. You can now send it to an exchange in a country that does not care about AML and withdraw your cash.

 

[DazedInPontoon]

You can now send it to an exchange in a country that does not care about AML and withdraw your cash.

Are there any exchanges in countries that do not care about AML that also will let you withdraw to a european or american bank account? or how do you see the "withdraw your cash" part happening?

 

[Zenith63]

Are there any exchanges in countries that do not care about AML that also will let you withdraw to a european or american bank account? or how do you see the "withdraw your cash" part happening?

Yes.

But the vast majority of ransomware activity is happening from Russia etc, why would a Russian criminal want to withdraw to a US/European bank account?

 

[letitroll]

Just 20% of the USA's meat production taken offline.........no information on payment mechanism

JBS: Cyber-attack hits world's largest meat supplier

The ransomware attack may mean delays for some customers in the US, Canada and Australia, the firm says.

www.bbc.com

Wonder what payment instrument the criminal/terrorists group chose as their preferred choice.....I mean if they're all the same.....cash/bank/bitcoin crypto.......it should be just a game of chance what this ransomware is denominated in

What do you think @tecate @WolfeTone - what method of payment did they choose to use, probably the one that lets them more likely get away with it? No?

 

[tecate]

Just 20% of the USA's meat production taken offline.........

Is this a good news story you're presenting?

no information on payment mechanism

This again...ransomware or bitcoin? (or both?) really grinds your gears. Is there a past trauma we need to be aware of? (and in no way do I believe that you aren't aware of the payment means - even if you've picked one specific article that doesn't disclose it).

Wonder what payment instrument the criminal/terrorists group chose as their preferred choice.....I mean if they're all the same.....cash/bank/bitcoin crypto.......it should be just a game of chance what this ransomware is denominated in

Here's something that should be instructive to you in terms of self awareness on this topic:

"I suppose it is tempting, if the only tool you have is a hammer, to treat everything as if it were a nail."

You highlight one instance where someone proposed to utilise a tool (in this case bitcoin) negatively today - when bitcoin settles $10 billion worth of perfectly fine transactions every day of the week. Here's what drug money looks like ->

That booty was seized a few years back ( i can get you plenty of more recent examples if you'd like - that's the first one I came across). I mean, there's an awful lot of cash there, don't you think?
ATM skimming costs around $1.3 billion annually. Credit card fraud accounted for losses of $29 billion worldwide in 2019. And as for electronic fiat, that booty above is only in the ha'penny place by comparison with the amount of funds that big banking moves around the globe for the cartels and others on an ongoing basis whilst ordinary people are either excluded from banking access or treated like criminals as they access banking services worldwide.

So clearly, the above spells out that bitcoin is no more used for criminality than any other means. That drives us back to your view that bitcoin just ain't worth it based on the experience of you and your buddies in Ireland not seeing any upside from it. The world is bigger than your peer group - and I've already provided you with data that addresses that point. Notwithstanding that, you are entitled to your view but we won't be finding agreement on that point. Yesterday the Human Rights Foundation allocated $250,000 in grants toward bitcoin development. One small example that thinking varies on this subject.

Beyond that, you're looking for bitcoin to be banned on the back of it accounting for a minority proportion of ransomware payments right now - knowing that it can't possibly be banned in every jurisdiction. Ergo - such a ban would be ineffective. If we just consider that in isolation, why on earth would anyone call for a ban on that basis in the full knowledge that it wouldn't be effective?

In all of these cases, responsibility lies with the organisations themselves. In the case of the HSE - the organisation most easily identified with mismanagement in Ireland - I would have thought that's obvious. It's instructive that you've never acknowledged that.