Nostr

So I'd counter that most BTC is purchased KYC--therefore, those coins are traceable.

And when they eventually make it into your wallet (no matter how circuitous the path), they'll be identifyable.

Worse still, is each transaction along the way is a taxable event, and the government will extract its pound of flesh from each.

AI makes all this efficient...and because the blockchain is public, all the data required for the analysis is available.

Mixing services...maybe, but I have little confidence that those are impervious to AI.

Essentially the origin of all coins is known (i.e. the original miner)- what's left is simply the legwork to trace their path across the different owners on the blockchain.

Conceptually similar to the old where's george on steroids...

its https://www.wheresgeorge.com/

Zach⚡️ 1y ago

This isn’t true. It’s impossible to prove who owns what. Let’s say I have a transaction with one input and two outputs. Which one is mine? Both? Neither? Is one change? Only I know, and the person I’m transacting with.

Even if I send to an address straight from an exchange, how does one know it’s my address? What if I’m paying a friend (which I’ve done in this manner before)

KYC and chain surveillance is based on assumed probabilities. It breaks down entirely after a few laps around a circular economy.

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banjo 1y ago

See my other note--all the government has to do is say "Coins moved...taxable event...pay up" and you have no recourse other than to pay the tax, or divulge you've moved coins to another wallet you own.

I do appreciate the discussion, yet I see challenges no matter how it shakes out...

Zach⚡️ 1y ago

Unenforceable in my opinion. But let’s say they try to enforce this, anyone serious needs to be in fight or flight mode.

Zach⚡️ 1y ago

What happens when I send Bitcoin to myself and then tell the IRS I sent it to you? 🤣

banjo 1y ago

And that initial wallet is always known--either it's a KYC exchange, or if you need to, you can simply go back to the original miner--it's all there on the blockchain.