On Tuesday a Dutch court sentenced the programmer Alexey Pertsev to five years in prison. The court found him guilty of money laundering because the "Tornado Cash" software he developed enables criminals to carry out completely anonymous and untraceable crypto transactions (so-called "crypto mixer")
This happens with cash too. If you take in a bunch of cash, you have a duty to know what it’s from so that you’re not facilitating terrorism or crime or subverting sanctions. In fact, of you handle cash or finance, you generally have to take training on these laws every year.
This thing is the definition of money laundering and was known for exactly those problems.
There are reasons to use this service that are completely legal. They should sentence the people laundering money, not the people providing privacy tools that happen to be misused.
I don’t think you understand. Banks (or anyone who accepts large amounts of money) has a duty to have some idea of where that money comes from. There are anti money laundering laws.
Go open a bank account right now and try to deposit a briefcase full of $50,000 in cash and see what happens. You might, maybe be able to do it, but there will absolutely be questions.
But, again, the same applies. I deposit btc or cash into a bank, even $50k, then I disclose its source to the authorities, with the paperwork. But by using a privacy service, I can comply with the law and protect myself from malicious actors
Go open a bank account right now and try to deposit a briefcase full of $50,000
I’ve done this. They ask you for the paperwork documenting the source of the funds. Just follow the process. It doesn’t matter if its fiat or crypto.
But in essence, they are punishing this guy for writing code. And at least in the United States, code is considered speech. And this is a very bad precedent. I know that this is a Dutch court, but still that is not a good thing.
It’s continental system. Precedents don’t have as much power as in English system. And Netherlands are in ECHR jurisdiction, so it’s likely to be overturned found contradicting European Convention on Human Rights.
And see, there’s where the problem comes in. He never actually took the currency from the smart contract itself. In fact, it is still online and being used as of this day. And he is getting none of the currency just like he got none of the currency before. What they are going after him for is creating a front-end user interface to access the contract. I believe they did take a fee from that user interface since it made it simpler than interacting with the contract directly. The problem is that they are saying that by taking fees from that user interface, he is money laundering, but not everybody who used that user interface was using it for money laundering. A famous example is the creator of Ethereum used it to donate to Ukraine.
Even had the front end website not been running, that money would have still been laundered. I heard an explanation of it earlier that was saying something to the effect of, imagine a door at the edge of a field. There is no walls, there is no nothing else, just a door at the edge of a field. Anybody can come into that field and use it whenever they wish. Putting a lock on the door will not keep people out of the field. They can just walk in wherever the door isn’t.
This happens with cash too. If you take in a bunch of cash, you have a duty to know what it’s from so that you’re not facilitating terrorism or crime or subverting sanctions. In fact, of you handle cash or finance, you generally have to take training on these laws every year.
This thing is the definition of money laundering and was known for exactly those problems.
There are reasons to use this service that are completely legal. They should sentence the people laundering money, not the people providing privacy tools that happen to be misused.
There’s no reason people using tornado wouldn’t have to disclose their sources to the authorities, same as cash.
But it does protect them from malicious actors.
I don’t think you understand. Banks (or anyone who accepts large amounts of money) has a duty to have some idea of where that money comes from. There are anti money laundering laws.
Go open a bank account right now and try to deposit a briefcase full of $50,000 in cash and see what happens. You might, maybe be able to do it, but there will absolutely be questions.
We know what the rules are dude, we are saying they’re wrong.
I think it will go to my quotes collection. “We know what the rules are, we are saying they’re wrong”.
That doesn’t apply to small amounts below $10k
But, again, the same applies. I deposit btc or cash into a bank, even $50k, then I disclose its source to the authorities, with the paperwork. But by using a privacy service, I can comply with the law and protect myself from malicious actors
I’ve done this. They ask you for the paperwork documenting the source of the funds. Just follow the process. It doesn’t matter if its fiat or crypto.
But in essence, they are punishing this guy for writing code. And at least in the United States, code is considered speech. And this is a very bad precedent. I know that this is a Dutch court, but still that is not a good thing.
It’s continental system. Precedents don’t have as much power as in English system. And Netherlands are in ECHR jurisdiction, so it’s likely to be
overturnedfound contradicting European Convention on Human Rights.He can write the code. He can release the source. Nothing is illegal until he takes currency.
And see, there’s where the problem comes in. He never actually took the currency from the smart contract itself. In fact, it is still online and being used as of this day. And he is getting none of the currency just like he got none of the currency before. What they are going after him for is creating a front-end user interface to access the contract. I believe they did take a fee from that user interface since it made it simpler than interacting with the contract directly. The problem is that they are saying that by taking fees from that user interface, he is money laundering, but not everybody who used that user interface was using it for money laundering. A famous example is the creator of Ethereum used it to donate to Ukraine.
He’s taking a fee in order to launder your money.
Even had the front end website not been running, that money would have still been laundered. I heard an explanation of it earlier that was saying something to the effect of, imagine a door at the edge of a field. There is no walls, there is no nothing else, just a door at the edge of a field. Anybody can come into that field and use it whenever they wish. Putting a lock on the door will not keep people out of the field. They can just walk in wherever the door isn’t.
I feel like this would be better if the field was surrounded by a 1 foot moat, and there was a bridge.
It would take some amount of effort to step over the moat and not trip, vs just walking over the bridge.
The bridge has a small toll to help maintain it.
But bridge or no bridge you’re getting into the field.
Lol, i like it
Yes, we agree. It’s still a bunch of bullshit.