Post
Topic
Board Bitcoin Discussion
Re: [solved]Possible to "trade" blocks?
by
Jim Hyslop
on 10/03/2011, 23:36:04 UTC
In fact, there'd be a disadvantage for large sellers: if BTC were overwhelmed with drug-related popularity, a "fed" could merely spend 5 BTC on a little pot, and then watch where that 5 BTC went, and as those 5 BTC got combined and mixed around, they could arguably claim that every other BTC that the original 5 touched or mixed with soon thereafter is also drug money.
Well, they can claim it, but no reasonable person should believe him.

Consider the same scenario, but with cash. Bitcoin is, after all, supposed to be a digital analogue (pun intended) of cash.

The fed writes down the serial number of a $5 bill, and uses that to pay for the pot. Suppose he has some magical way of keeping track of every transaction made with that $5 bill. The drug dealer goes to the corner store and buys a bag of chips and a bottle of pop (soda for you Yanks :-). Ten minutes later, a sweet old lady comes in to buy something, pays with a $10 bill and gets the "tainted" $5 as part of her change. That Sunday, she drops the $5 bill on the collection plate at church. The church then deposits its weekly givings at the bank. Do you think any reasonable person is going to believe that the entire collection is drug money? Not likely.

And the fact that you can split a bitcoin makes it even harder to follow its history, because as soon as a bitcoin is split into different coins, particularly if another coin is combined with it at the same time, it's almost impossible to figure out which of the two out transactions contains the "tainted" coin.