zlacker

>>mikeyo+(OP)
> “After the execution of court-authorized search warrants of online accounts controlled by Lichtenstein and Morgan, special agents obtained access to files within an online account controlled by Lichtenstein,” the press release said. “Those files contained the private keys required to access the digital wallet that directly received the funds stolen from Bitfinex, and allowed special agents to lawfully seize and recover more than 94,000 bitcoin that had been stolen from Bitfinex. The recovered bitcoin was valued at over $3.6 billion at the time of seizure.”

So most likely,

1) they didn't launder it properly, leading to police being able to trace it to their bank accounts. I wonder if tornado.cash was used.

2) then police had their names, leading to warrants for all online accounts - google account, apple account, etc.

3) they made the big blunder of keeping their private keys in their online account. Most likely a txt file in google drive. That is such a silly blunder. Without the private keys, the police has zero proof of anything. They could have made a hundred excuses for how they got money in their bank account, as long as the police didn't have the private keys. Who keeps their private keys in an online account?

Apparently the biggest criminals make too many silly mistakes. The old saying applies here: "you don't have to be smart, just don't be an idiot"

>>Alexan+Ub
A good guess is that "laundering" billions of dollars is inherently a non-trivial problem, and perhaps not feasible at all without cooperation from shady real-world actors outside the whole cryptocurrency ecosystem. This is actually good news for small-scale users who just want to keep their microtransactions reasonably private - the usual mechanisms might actually work well enough for that case.

>>zozbot+9f
I agree. But if not for privacy, why use crypto at all? Even bank accounts are reasonably private, if you are not doing anything considered suspicious by society.

Also, with mixers such as tornado_cash, laundering money is ,sadly, pretty trivial.

>>Alexan+9h
Mixing is not laundering.

The difference is that laundering provides you with an explanation for wealth and/or income. Example of laundering: buy a business (with clean or borrowed money), have fictional customers "spend" their cash money at your business every day, then report your income and pay taxes. Now if anybody asks about where you got your money, you have a seemingly legit explanation.

Mixing does none of that. So mixing may be trivial, but laundering is not.

edit: now that I think about it, is that why NFTs are so popular? Are people pretending to have gotten capital gains, while in reality they're buying these things from themselves? That would explain a lot.

>>wcoene+mk
tornado.cash puts your crypto in a completely fresh account (using smart contracts). You can claim that you earned this crypto mining it back in 2010. You can definitely come up with a decent excuse for this.

Then you can convert those crypto (in new account) into fiat money.

Everyone will know you are lying, but they will never be able to prove it.

>>Alexan+yl
If you read the indictment, they claimed they had bitcoin from mining in 2011, the exchange asked for further proof, and they just abandoned the bitcoin (~$150k). The exchange surely notified the authorities, because who abandons $150k of legit bitcoin?

So claiming it was from mining didn't work in this particular instance.

They don't need to prove you are lying in all instances, it's enough to prove you are lying in one instance. They will get you for that one instance where you didn't launder it properly if they are after you.

>>323+Cc1
I'm surprised the exchange notified the authorities. Are they forced by law?