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by Hnus 1408 days ago
Can somebody more knowledgeable confirm if all your coins will become forever tainted if you are "dusted" like this? As there is no way how to break ever break the paper trail using just bitcoin is only way how to make your coins clean going to monero and back again or something like that? Are techniques determining if your coins are tainted or not on exchanges where they could be refused or confiscated sophisticated enough to not flag you in cases like these? Even if its possible I imagine its computationally expensive.
3 comments
dereg 1408 days ago
Yes. Ethereum does not have coin control[1] which means that your entire ETH balance is inextricably commingled in a dusting attack, whether you like it or not. That's different from Bitcoin, on which you can choose to not spend tainted coin in your wallet (and prove the provenance of your funds).

[1]: https://bitcoin.design/guide/how-it-works/coin-selection/

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salawat 1408 days ago
Regulators aren't stupid.

There will be a hotline or process for reporting your having been dusted. You call, let them know, they confirm, they give you special dispensation to move the tainted funds to a burn address most likely. They don't care the ultimate location in which the funds get locked down, only that they do.

That Ethereum allows for disting won't hamper things the least bit. However a lot of customer service is probably going to have to be accommodated, so if you do get dusted, I sure hope that wasn't your only financial lifeline, because it may take a while to work through.

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Hnus 1407 days ago
Hotline you describe seems like pure speculation I find unlikely but I have no idea how the law works but few questions naturally come to mind. Customer of which service? Provided by who? Agreed upon using what contract? Also having to burn your entire pile of cash because of one spec of dust is really funny.
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waynenilsen 1408 days ago
It is actually worse than you think, the entire account ends up having "interacted" with a "sanctioned" entity :( account owners may be subject 10y in jail if any prosecutor would bring a case. This is true for any tokens and NFTs associated with the account as well as the ETH.
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