Ten arrested in Netherlands over Bitcoin money-laundering allegations _ Hacker News definition of money laundering

It sounds to me that bitcoin is a lousy medium for money laundering. It’s unclear to me whether they laundered money by supposedly buying and selling bitcoins or converted shadowy assets into BTC and then back to physical currency, but in both cases the transactions can be tracked back in the blockchain so you’ll not only have to make a good story of where the money came from but also, if and when the authorities get interested, make sure that how the BTC is moved around reflects that story.

But merely converting BTC to cash via atms doesn’t even sound like laundering to me at all, just conversion. You would still need to explain the cash you’ve acquired if you intend to buy something with it.

Money laundering itself is not for those in a hurry.

To plausibly launder money you need a service business with costs that are rather fixed and customers who can plausibly pay with cash.Definition of money laundering then you can have as many customers as you like and nobody can really tell how many you really might have had but depending on how you set up the scheme you can report a reasonable income over the months and years, pay the taxes and thus turn the money legally earned.

Yeh, sadly enough the dutch media and government try to totally hide this in their stories. Bitcoin == money laundering, and TOR == THE DARK WEB. Period. [0]

The article is full of misdirections and word plays.

It starts of with bitcoin is used by criminals, because the currency is not controlled by banks and thus there is no supervision. This is the first misdirection, because just because it’s not controlled by banks doesn’t mean you cannot supervise it. The core idea of bitcoin is supervision. It’s a public ledger.

It then continues to support their argument by saying bitcoins go back and forth in a closed system of users, so authorities can’t see it.Definition of money laundering which is just a plain lie. Bitcoin is an open system. Anyone can see any transaction.

The article continues:

As soon as the bitcoins were turned into real cash, the money was turned into cash at banks. They finally stepped to the police, because their warning systems detected large amounts of money being transferred.

So apparently it was really easy to track down? They detected the weird transfers and were able to find the criminals. Seems bitcoin actually saved us here? That totally is the opposite of what they told us two paragraphs back where they said there is no insight at all in what happens with bitcoin

The article then continues to mumble about how TOR == dark web and it’s just painful to read. I hate media.

Now my mom starts asking me akward questions about hard drugs because I have a TOR and a bitcoin sticker on my laptop.

[0] http://nos.Nl/artikel/2081531-bitcoins-en-dark-web-een-goed-…Definition of money laundering

Why is bitcoin often associated with money laundering, as you say:

Because it’s the ‘unique’ element of the story.

I.E., a million money laundering and fraud schemes are reported on every year, but the specific currency isn’t mentioned. No article states ‘ten arrested over dollar money-laundering allegations’.

But if it’s bitcoin, it’s interesting to mention. It’s quite similar to how say minorities are reported on when it comes to criminal news, in my country for example you’ll never hear ‘5 white men robbed a person’, but if it’s an immigrant, a muslim, a refugee, it’s much more likely that somewhere his heritage is reported. Because it’s exactly this element that separates them from the ‘regular’ news of the majority ethnicity. In the same way, bitcoin is the element that separates it from the regular money laundering news, so it’s highlighted in the reporting.Definition of money laundering

None of it is untrue, but it’s quite easy to appreciate how this frames the issue. Anytime there’s financial fraud in dollar-denominated accounts, it’s ‘just financial fraud’, when it’s in bitcoin it’s not ‘just financial fraud’ but ‘bitcoin fraud’. So now you have a world in which majority currencies aren’t specified or highlighted in negative reporting, but minority currencies are.

For example, the article is on the netherlands, in this particular case about $20m is estimated to have been involved, part of it laundered through bitcoin, part of it through various fiat currencies and luxury goods. Is $20m significant? Well let’s go back 6 years to 2010, when a bitcoin costed $0.04 (today around $400) and was virtually non-existent. At the time the netherlands invested about $100m into improving the ability to track and prosecute money-launderers. (already you can see, if a government invests $75m to fix a problem, you can be rest-assured that $20m is a tiny part of the problem).Definition of money laundering at the time the police also estimated that in the netherlands alone about $20 billion was laundered. As such, this bitcoin laundering case, the first of this magnitude I’m aware of in the netherlands in years, consists of just 0.1% of the annual money laundering.