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by asojfdowgh 1400 days ago
"breaking the chain of public transactions" sounds remarkably similar to "concealment of the origins of" for some reason.
3 comments

It's only money laundering if you are concealing the origins of money from an illegal activity.

I can use Torando Cash to conceal the origins of my paycheck, for example to preserve my privacy when transacting with peers.

> can use Torando Cash to conceal the origins of my paycheck, for example to preserve my privacy when transacting with peers

Probably. After it’s been publicly outed as a known money laundering venue, however, you should switch to another service. It’s also reasonable for everyone who deals with you henceforth to subject you to additional scrutiny, to make sure you were not in face laundering. Because while the privacy vs. friction tradeoff may be acceptable to you, it’s not to everyone, and just as you have a right to privacy they have a right to not associating with you.

But there's no reason to do that unless you're trying to hide a crime.

I'm sympathetic to the free speech argument, but also, if I put up plans for the Kitty Murdulator 9000 whose principally designed to kill kitties, then yeah I'd call that bad. Like sure you could do something else with it I guess, maybe, but it's clearly designed for one thing, and one thing only.

Don't want your transactions to be public? Use a bank like a normal person.

I don't need a reason to do it or not, it is legal under the law.

Tornado Cash has legal uses under the law (like the one I described above), because it can be used to conceal the origins of legally obtained money.

See the legal definition of money laundering here: https://www.law.cornell.edu/uscode/text/18/1956 , it specifically calls out "unlawful activity".

There was plenty of unlawful activity done using Tornado cash.

For example the money stolen in the Axie Infinity hack was lauded through Tornado Cash.

There are heaps of reasons to do that, you could want to use crypto but also want your transactions to not be public.

An obvious example would be a software engineer working in web3 that gets a portion of their pay check in a crypto asset.

That's great and all, but that doesn't change the responsibilities incumbent on a service that transfers value under the law. And that is to ensure their compliance with AML and KYC rules - and best effort verification that sanctioned individuals aren't using it. None of which this particular service did. RIP.

I think something like 1/4 of all the transactions on Tornado were laundering lol. Imagine any other business that operated like that. For instance, a bank where 1/4 of tellers are stealing the deposits of customers. At some point, the banking that happens is incidental to the actual business.

So like, if you have a legitimate use for the service, and you know that by participating you're facilitating money laundering, you're complicit IMO. And if you don't want to be complicit, go find a different service.

This privacy-absolutism is silly though.

Something like 1/4 of worldwide all employment is 'informal' (i.e. typically quasi-illegal or outright illegal).
First, I'd love a citation.

Second, if true, is that a good thing? Or are you saying that if one person is getting away with something then everyone should just be able to do it.

This has big 'but mom, Jeffrey Dahmer got to kill and eat people' energy. Nobody gets to kill an eat people. Just because Jeffrey Dahmer did it doesn't mean you do. And it doesn't mean we should be building tooling that allows people to more efficiently kill and eat each other just because one guy found a way to use it as a hat pin.

> there's no reason to do that unless

the owner of the money decides to do that; private transactions are a thing

I deposit 100 ETH to tornado, wait a while, and withdraw in 10 ETH increments. There is still no explanation for the origin of the funds. Money laundering is made up of placement, layering, and integration. Tornado did only one of these (kinda).
Now imagine you use those anonymous 10ETH chunks to buy NFTs from yourself, or invest in your own ICO, etc etc etc.
Privacy is not a crime.