Subnostr

nostr:npub1excellx58e497gan6fcsdnseujkjm7ym5yp3m4rp0ud4j8ss39js2pn72a nostr:npub1ajlrwgfj4yerhqf7ady03h7wmtk2qr3gs7h3sxcx83k05yld36sswpzx3q

In the spirit of providing feedback for wallet devs and sharing experience with other users, I’ll give an account of an experimental transaction that I initiated today.

Scenario:

My wife using AquaWallet in Hong Kong to off ramp a small amount of BTC to cash in the local currency. There are still street level walk in exchanges in HK, for now at least, that offer exchange to/from cash of various crypto assets without KYC as long as the value is below circa US$15000.

First question to the exchange was do they accept transactions on Liquid network. Answer- No

Ok, so I got my wife to do a quick in app swap of L-BTC to L-USDT, which could then be transacted over either the ETH or Tron network. As this experiment was an attempt at using the lowest fee possible she chose Tron.

Sales girl then asks for my wife’s Tron address in order to do a risk check. She used the term “Risko” (possibly a company that provides a list of black listed wallet addresses?)

As the Tron feature of sending USDT on Aqua is, I think, in the background she wasn’t able to access my wife’s Tron wallet address because it is all labelled as the liquid wallet address in Aqua, but agreed to try with a small USD value and then get the necessary info from the Transaction #.

Transaction was successful, but significantly slower than a direct Tron network transaction.

Sales girl then said that the wallet address that was used by Aqua appears to be a “mixer” and while she would honour the very small transaction, a few USD, the company would not in future accept such a method. It wasn’t clear to me if she meant the Tron address, which was possibly a hot wallet run by Aqua or actually the Liquid address, that was being called a mixer.

This note will upset Western BTC purists. I’m fully aware that today’s on chain fees are quite low so an on chain BTC transaction would have made perfect sense but this experiment was an attempt to look at options when in future fees go mental again. It might also highlight a potential future where exchanges label Liquid network a mixing service.

I will point out that they do accept Lightning transactions but if there was a scenario in future of a much higher value transaction, that doesn’t seem plausible as of now. I’m not sure on the Lightning setup in Aqua as it might also be in the background and not self-custodied, in terms of address, at a user level.

A few questions from this.

Is Liquid considered/flagged as a mixer by exchanges/regulated vasps?

What/who is the company called “Risko” that is providing blacklisted address data to exchanges?

Does the address blacklist have any implications for Lightning addresses/nodes/Lightning “on phone type” wallet providers in the future?

Reed 1y ago

I don't have definite answers to any of your questions and I have no experience with USDT or Tron. But I do know that Aqua wallet is really a liquid wallet and if you want to send it over to any other asset they use swap services. A swap service such as boltz.exchange is most likely what got flagged as a mixing wallet, probably nothing to do with liquid. This is also why the tx took longer to confirm because it needed 2 confirms on the liquid network to send to boltz (2 minutes) then they send the other asset from their wallet (in this case USDT on Tron).

I hope this helps 🤙

Reply to this note

Please Login to reply.

Discussion

SovereigntyQuest 1y ago

Yea, I've been thinking through what they saw from their end and reckon you're probably right. It's not the liquid aspect that is getting flagged it's the swap service, be it boltz or side swap that is probably the transaction that looks like a mix before it gets put onto Tron. Perhaps that Tron address is their own hot wallet but maybe also unique addresses for each transaction which would look mixish? I hope maybe Aqua Wallet or Samson see this note and be able to shine a bit of light on it.

Like you I've never used Tron so unsure about that part.

Personally I'm a bit wary of veering too far away from BTC onchain but fees will, I believe, get really out of control at some point soon so seeing what those who are innovating is worth looking at. I did find Liquid to have a good use case as a store of sats that I could access and use for rebalancing my lightning node when needed without having the high on chain fees make it uneconomic.

Reed 1y ago

Yes I have liked Aqua wallet so far. I try to keep any Bitcoin I earn separate since it's no KYC, but I got stuck last year when fees got huge and was relieved when I finally consolidated my UTXOs when fees dropped.

Now I save up ~1M sats on liquid and then send to my on chain cold storage. It's been working well so far. I also opened up some bigish lightning channels and then swapped back to on chain for liquidity.

SovereigntyQuest 1y ago

Aqua took what Green Wallet were and I think put the need for doing that boltz/side swap thing into the background which is cool and definitely good for my wife. Adding USDt is controversial but for a lot of the world a real use case. Like I said in my note I really wanted to give my wife the chance to try an off ramp experience with Aqua.

We all know the Neo meme of "Where we're going we don't need an off ramp" but we aren't there yet and spending "money" shouldn't be a dirty word so taking advantage of saving for years in bitcoin and using a little of it to live life should be something the community of bitcoiners discuss.