El Salvador to adopt Bitcoin as legal tender.

Capt'n Midnight

Wanderer78 wrote: »

Not really, their economy is probably wrecked, and this could be an act of desperation, I expect a significant rise in criminal activities from this move, as bitcoin isn't actually a currency at all, it doesn't have any of the criteria of being one

They are one of a number of countries that are using actual US dollars instead of a local currency.

thebossanova

Hamsterchops wrote: »

"Isn't actually a currency at all", this even though it's now legal tender (in El Salvador). I thought that because its status had changed to 'legal tender' it would now be a recognised currency?

Admittedly, I know nothing about Bitcoin.

Yes, I think you're right. The legal implications will become clearer in the coming weeks, presuming El Salvador does what it says and passes the bill, but technically it should become a currency if it's legally recognised for transaction and used as a reserve by the ES central bank. Whether the US etc. recognise this is still to be seen but I wouldn't be surprised if statements and sanctions were to follow to 'dissuade' El Salvador from continuing down this path.

Capt'n Midnight

thebossanova wrote: »

Yes, I think you're right. The legal implications will become clearer in the coming weeks, presuming El Salvador does what it says and passes the bill, but technically it should become a currency if it's legally recognised for transaction and used as a reserve by the ES central bank. Whether the US etc. recognise this is still to be seen but I wouldn't be surprised if statements and sanctions were to follow to 'dissuade' El Salvador from continuing down this path.

What reserve ?

The local currency is the US dollar. Over a third of all US notes are held abroad.

Hamsterchops

On a related note . . .

http://news.sky.com/story/millions-of-dollars-in-bitcoin-ransom-seized-from-colonial-pipeline-hackers-12327363

Millions of dollars in Bitcoin paid to hackers after the Colonial Pipeline cyber attack have been recovered by the US government.

thebossanova

Capt'n Midnight wrote: »

What reserve ?

The local currency is the US dollar. Over a third of all US notes are held abroad.

The reserve that all countries have to run their national and international business that they collect from taxes etc.? Thy have a central bank like most countries.

Joe Don Dante

proper order!

Del Griffith

Donald Trump wrote: »

Using the example of FBI tracking transactions from known criminal activities to specific wallets is like the FBI recording serial numbers of notes and tracking them down and catching a random fella in a shop spending them (albeit the recording is automatic).

It is of no use in identifying owners of intermediate wallets in a chain of transaction if the owners of those wallets never use them to interact with an external interface - but instead only use it for accepting enough payment in bitcoin to cover what they need to send on themselves to their own suppliers.

100 Euro worth of bitcoin that is transferred by a junkie in Dublin, which ends up being spent by a poor farmer in El Salvador is not going to convict the Dubai resident cartel druglord whose wallet it passed through. He can easily be careful and only accept enough payment into it that he needs to go out the other end to his own producers.

Chain analysis tools will actually scrutinise 4 hops back in the chain as standard (variable by the owner obviously but 4 hops is the recommended and widely accepted).

This means that in your example the farmer could have his account frozen if and when it touches off the traditional banking system or a regulated exchange, and have to provide source of funds documentation to free it up again.

This might be through no fault of his own at all, since the alert may have been triggered by an interaction on the chain from before he came into possession of the cryptocurrency.

It's actually ridiculous, beyond KYC and in fact more like KYC-C or KYC-C-C but this is the price of a public ledger - regulatory bodies have a wide view, some would say too wide.

This is contrary to say, cash, which any criminal can spend at will if its under the radar.

Donald Trump

Del Griffith wrote: »

Chain analysis tools will actually scrutinise 4 hops back in the chain as standard (variable by the owner obviously but 4 hops is the recommended and widely accepted).

This means that in your example the farmer could have his account frozen if and when it touches off the traditional banking system or a regulated exchange, and have to provide source of funds documentation to free it up again.

This might be through no fault of his own at all, since the alert may have been triggered by an interaction on the chain from before he came into possession of the cryptocurrency.

It's actually ridiculous, beyond KYC and in fact more like KYC-C or KYC-C-C but this is the price of a public ledger - regulatory bodies have a wide view, some would say too wide.

This is contrary to say, cash, which any criminal can spend at will if its under the radar.

What are you going to freeze his account for? For spending it in the local shop? Also, if it is legal tender, it never needs to go onto an exchange to be converted to another currency.



Junkie Paddy settling his debt in Dublin didn't go down to the local barracks to tell all the Guards about his junkie adventures. There is nothing to connect those tokens to criminality. It is different for an extortion or ransomware crime.


I'd imagine that the lads in the middle transferring millions might also be able to figure out how to obtain new wallets over and over again.

Del Griffith

Donald Trump wrote: »

What are you going to freeze his account for? For spending it in the local shop? Also, if it is legal tender, it never needs to go onto an exchange to be converted to another currency.

They'll freeze it under AML policy until he provides source of funds verification, it doesn't matter where or what he spends it on. Once he provides it and its clear the trigger event wasn't when he had the coins it'll be unfrozen again.

I'm not talking about what might happen. I'm talking about what does happen. Already. Now.

Donald Trump wrote: »

Junkie Paddy settling his debt in Dublin didn't go down to the local barracks to tell all the Guards about his junkie adventures. There is nothing to connect those tokens to criminality.

Apart from the blockchain history.

Donald Trump wrote: »

I'd imagine that the lads in the middle transferring millions might also be able to figure out how to obtain new wallets over and over again.

Yea. In fiat that's called layering. Money laundering still exists in digital format.

RulesOfNature

Lol. Literally all anyone has to do is tumble/mix it once and congrats the trail has gone cold. Unless your local gardai station has a quantum computer, ofcourse.

Or you can just use monero and forever be safe.

If there was ever a way of laundering or hiding money its through cryptocurrency. If you ever looked past the surface level take of ‘The blockchain is public!!!!’ you’ll know that it’s literally mathematically impossible to track transactions if the person knows what theyre doing.

Del Griffith

RulesOfNature wrote: »

Lol. Literally all anyone has to do is tumble/mix it once and congrats the trail has gone cold. Unless your local gardai station has a quantum computer, ofcourse.

Or you can just use monero and forever be safe.

If there was ever a way of laundering or hiding money its through cryptocurrency. If you ever looked past the surface level take of ‘The blockchain is public!!!!’ you’ll know that it’s literally mathematically impossible to track transactions if the person knows what theyre doing.

Except that tumbling coins is in itself a huge red flag.

Send your bitcoin through a darknet mixer onto your wirex card there, let us know how you get on.

On the other hand you'll have no issues spending low level cash down the local shop.

RulesOfNature

Del Griffith wrote: »

Except that tumbling coins is in itself a huge red flag.

Send your bitcoin through a darknet mixer onto your wirex card there, let us know how you get on.

On the other hand you'll have no issues spending low level cash down the local shop.

If you're worried about the 'red flags' (lol) just buy monero. Problem solved.

Del Griffith

RulesOfNature wrote: »

If you're worried about the 'red flags' (lol) just buy monero. Problem solved.

I'm not worried about anything. We're in discussion here about traceability of bitcoin. Dunno if you noticed (lol).

Del Griffith

Anywho, they are all at it now:

https://twitter.com/balajis/status/1402279912623464458?s=20

Donald Trump

Del Griffith wrote: »

They'll freeze it under AML policy until he provides source of funds verification, it doesn't matter where or what he spends it on. Once he provides it and its clear the trigger event wasn't when he had the coins it'll be unfrozen again.

I'm not talking about what might happen. I'm talking about what does happen. Already. Now.



Apart from the blockchain history.



Yea. In fiat that's called layering. Money laundering still exists in digital format.

So Del, once someone rocks up to a shop in El Salvador to buy a loaf of bread, the local shopkeeper is going to demand proof of source of funds before accepting his now legal tender.


Lets be realistic here. There are cartels and gangs over in these countries with ostentatious wealth who don't exactly get dragged in every week to prove sources of their funds.

RulesOfNature

Del Griffith wrote: »

I'm not worried about anything. We're in discussion here about traceability of bitcoin. Dunno if you noticed (lol).

Just buy monero. No need to sweat it.

Del Griffith

Donald Trump wrote: »

So Del, once someone rocks up to a shop in El Salvador to buy a loaf of bread, the local shopkeeper is going to demand proof of source of funds before accepting his now legal tender.


Lets be realistic here. There are cartels and gangs over in these countries with ostentatious wealth who don't exactly get dragged in every week to prove sources of their funds.

You say lets be realistic while talking about a shop keeper accepting BTC for a load of bread.
Realistic is that the uptake of BTC as a currency in El Salvador is going to be zero. Just like Ohio accepting it for taxes in 2018. BTC isn't used that way.

Outside of speculation, it is used to move value and wealth cross border in a relatively frictionless manner. Eventually if it's to be spent, it will need to interact with the traditional system.

It can of course be laundered. My only point here is that when it comes to "un-traceability" as was implied earlier in the thread by another poster, cash is still 100% king.

Del Griffith

RulesOfNature wrote: »

Just buy monero. No need to sweat it.

Are you in the wrong thread?

Donald Trump

Del Griffith wrote: »

You say lets be realistic while talking about a shop keeper accepting BTC for a load of bread.
Realistic is that the uptake of BTC as a currency in El Salvador is going to be zero. Just like Ohio accepting it for taxes in 2018. BTC isn't used that way.

Outside of speculation, it is used to move value and wealth cross border in a relatively frictionless manner. Eventually if it's to be spent, it will need to interact with the traditional system.

It can of course be laundered. My only point here is that when it comes to "un-traceability" as was implied earlier in the thread by another poster, cash is still 100% king.

The issue with cash, that is not present with cryptocurrency, is in transporting it across borders. The is a chance, albeit small, that physical cash can be seized. Sending it through the financial system is also ultimately somewhat traceable. Although perhaps not end-to-end. But the flows can be detected.

All of these things can be detected easier these days with ML & AI

RulesOfNature

Del Griffith wrote: »

Are you in the wrong thread?

Nah. Just finding the conversation about using Bitcoin for illegal activities when Monero exists solely for that purpose kinda stupid.

If you're this concerned about using bitcoin, dont. Use monero.

Donald Trump

RulesOfNature wrote: »

Nah. Just finding the conversation about using Bitcoin for illegal activities when Monero exists solely for that purpose kinda stupid.

If you're this concerned about using bitcoin, dont. Use monero.

Why?


The thread is about Bitcoin being adopted in El Salvador as legal tender.


There is nothing stopping anyone from using their bitcoin to buy your Monero and then converting it back later by buying bitcoin in order to spend it if they want.

RulesOfNature

Donald Trump wrote: »

Why?


The thread is about Bitcoin being adopted in El Salvador as legal tender.


There is nothing stopping anyone from using their bitcoin to buy your Monero and then converting it back later by buying bitcoin in order to spend it if they want.

'Lets talk about using a hammer to fix in screws. No dont talk about screwdrivers, we're talking about hammers'

That's how I see this conversation. Just use a screwdriver when you need to. Use monero.

Donald Trump

RulesOfNature wrote: »

'Lets talk about using a hammer to fix in screws. No dont talk about screwdrivers, we're talking about hammers'

That's how I see this conversation. Just use a screwdriver when you need to. Use monero.

Except that the thread is about hammering in nails. You want it to be about screws for some reason.



I'll use neither thanks. Couldn't be arsed buying or using cryptocurrency.

RulesOfNature

Donald Trump wrote: »

Except that the thread is about hammering in nails. You want it to be about screws for some reason.



I'll use neither thanks. Couldn't be arsed buying or using cryptocurrency.

Wasn't talking about you specifically.
I'm saying the conversation is obviously stilted because people are trying to use bitcoin as an example of why cryptocurrency is unsafe to use for money laundering or illicit trades, while at the same time completely dismissing the one token built specifically for those uses.

People talking about the traceability of Bitcoin are missing the point that only big things like important ransomware payments are traced. For regular stuff, like drugs etc., it is effectively untraceable because no one is looking for it. Like if I want to move all my money from Vietnam to Ireland without proving where I got it, Bitcoin is the easiest way. The alternative is the gold shops which would send money into my account from another Irish account, but that sender account is somewhat traceable.

Tracing bitcoin is a reaction to a known crime. Tracing normal currencies can expose a crime.

bitburger

Del Griffith wrote: »

Eventually if it's to be spent, it will need to interact with the traditional system.

coinmap.org says otherwise. I can spend bitcoin on (legal) goods/services within Ireland if i wish.

Del Griffith

[Deleted User] wrote: »

People talking about the traceability of Bitcoin are missing the point that only big things like important ransomware payments are traced. For regular stuff, like drugs etc., it is effectively untraceable because no one is looking for it. Like if I want to move all my money from Vietnam to Ireland without proving where I got it, Bitcoin is the easiest way. The alternative is the gold shops which would send money into my account from another Irish account, but that sender account is somewhat traceable.

Tracing bitcoin is a reaction to a known crime. Tracing normal currencies can expose a crime.

Unless you're staying in btc forever, this is wrong most of the time. As I've already outlined if you want to get your Vietnamese bitcoin into an Irish bank account the analysis will be applied at the conversion stage.

Del Griffith

Del Griffith wrote: »

Unless you're staying in btc forever, this is wrong most of the time. As I've already outlined if you want to get your Vietnamese bitcoin into an Irish bank account the analysis will be applied at the conversion stage.

Can you explain how this would happen?

bitburger

bitburger wrote: »

coinmap.org says otherwise. I can spend bitcoin on (legal) goods/services within Ireland if i wish.

Such as?

Bitcoin is now legal tender in El Salvador the bill has passed
https://www.cnbc.com/amp/2021/06/09/el-salvador-proposes-law-to-make-bitcoin-legal-tender.html