Ten arrested in Netherlands over Bitcoin money-laundering allegations

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. 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.

They were arrested for drug traffic, not bitcoin money-laundering.

> The alarm had been raised by banks which had seen “large sums of money” being deposited before being immediately withdrawn at cashpoints.

Not the smartest individuals here. How did they think they wouldn't get caught? Seems like another anti-bitcoin peace article which ends with the mt gox failure and this gem: "Bitcoin’s reputation was also damaged when US authorities seized funds as part of an investigation into the online black market Silk Road.". So that means the dollar and euro's reputation are damaged every day when funds are seized as part of 99.9% of criminal investigations?

I've researched BTC laundering, because I'm too curious to live.

The main method of doing it is via "mixers", servicss that distribute your BTC among hundreds of accounts, and then pay you back (minus a small fee) via hundreds of other accounts. Theoretically, it's impossible to track a single payment through such a process, since the BTC paid back isn't the BTC paid in.

Another possible security measure woukd be the use of multiple accounts, allowing legitimate purchases and purchases involving physical locations to be separate from illegitimate buys.

The main weak point is your location; once a physical object is shipped to you, it's real easy to tie that to your illicit BTC wallet, and from there, you're hosed.

Interesting everybody pointing out that BTC is traced through the public block chain - but what about BTC tumblers/mixers that are designed specifically to anonymize BTC transactions?

I remember one Reddit thread where they chased some huge amount of BTC which were stolen and ended up losing them in one of these:

https://www.reddit.com/r/SheepMarketplace/comments/1rvlft/i_...

As far as I know the thief got away with it.

Is there any articles that clarify what these guys were actually doing to make the money?

The fact that they don't mention it makes it sound like they might have been doing something more interesting than just selling drugs, as usually they tend to be fairly public about those cases.

Edit: Guess it was just some drug dealers then,

>All suspects fell into one of two categories – criminal “traders” on the Dark Web and “bitcoin-cashers” who are paid by these traders to exchange bitcoins for cash

"Bitcoin’s reputation was also damaged when US authorities seized funds as part of an investigation into the online black market Silk Road."

If by "seized" they mean "stole". Notice how they spin the fact that US authorities were charged and prosecuted for STEALING bitcoins while investigating Silk Road into the fiction that it damaged the reputation of Bitcoin, but not US authorities.

This article is a piece of garbage.

Should have done it thru London property, then the establishment get a cut.