Let's play hypotheticals.
If you were the attacker and you now have the ETH in your wallet, how do you cash out without anyone identifying you and maximising your profits?
Also has the attacker broken a law by exploiting a bug in the contract?
If you were the attacker and you now have the ETH in your wallet, how do you cash out without anyone identifying you and maximising your profits?
Also has the attacker broken a law by exploiting a bug in the contract?
Keep sending cash to bank accounts you have opened by depositing cash in person. Use round robin to distribute money across multiple of your hidden bank accounts so suspiciously large volumes of incoming money doesn't get noticed.
Keep moving around, mixing coins and using localbitcoins to get cash and deposit. Also diversify outside of cash to not raise suspicion of the banks by depositing every day / regularly.
Buy physical gold from pawn shops. Then you can turn gold into cash in banks and deposit it to your account like that. You can also use cash to buy prepaid travel debit cards with like 5k on them at a time from post offices or so. Use that for daily expenses.
That might work. If you are not a US citizen but let's say citizen of China that makes it easier to pull off.
Of course, getting that money back to US to your home bank account would be near impossible (without some way to launder the money).
But you could live off your hidden bank account in tax haven. Just don't flash your millions too publicly so people don't get suspicious. Be humble and pretend to live regular life.
Also you could try to launder the money via setting up some fake ICO project and investing your mixed coins into your own ICO, then cash out your custom tokens on exchanges. Just make sure to do this from some unregulated tax haven and it should work (most of these ICOs create their businesses in dodgy tax havens for this reason).
This is how I'd imagine these scammers are doing it.
Exchange to BTC, mix it, exchange to USD.
> Also has the attacker broken a law by exploiting a bug in the contract?
There are no laws. Only contracts.
You could use localbitcoins to offload one coin at a time on an as-needed basis. That'd be pretty sweet, and the IRS won't be able to know anything strange is happening if you avoid depositing your USD into a bank. But paying rent in all-cash is rather sketchy. I wonder if drug dealers deal with similar problems.
I don't know how plausible this is, but the localbitcoins route might also open you up to being kidnapped. You'd need some pretty decent opsec to avoid revealing that you have a massive amount of BTC you're trying to offload.
> And then the IRS will want to know where you are suddenly getting a huge amount of money from.
In my experience, the IRS is largely unconcerned with where you are getting money from. They just want you to declare it, and pay taxes on it.
If you treat Bitcoin as ordinary income and pay taxes on it at the highest available rate, the IRS will largely be satisfied. If you treat Bitcoin as a long term investment and attempt to only pay capital gains tax.... well then the IRS will become curious enough to ask for 'proof of origin'.
I'd personally call them and get a contract out before funneling this kind of money through their system.
Though that's pretty normal. A regular brick and mortar bank would likely want additional assurances before funneling $30 million into or out of an account that doesn't see that regular volume.
I mean, I don't personally know which alarms would be tripped, or what effect that would have. But that just seems so unlikely.
It'd be fascinating if this were true, though, so any info would be appreciated.
Re: coinbase, it'd be foolish to use them because they have a history of disabling accounts for any reason they feel like. A friend of mine had their account disabled, so I know firsthand this is true. Also it's unlikely they'd send you such a large amount of money unless you were a business in good standing or had a long history with them. (I'm just guessing, though.)
It is perfectly reasonable to be a cryto trade that never withdraws to USD, and just makes money by transferring between crypto currencies and ICOs or something.
I am sure there are a whole lot of people out there who spent a thousand dollars or so back in 2009, and now they have 10 mill in the bank. It is not like any of that could be tracked.
And then you pay long term capital gains on that money, and you are set.
> https://www.irs.gov/publications/p17/ch12.html#en_US_2016_pu...
Illegal activities. Income from illegal activities, such as money from dealing illegal drugs, must be included in your income on Form 1040, line 21, or on Schedule C or Schedule C-EZ (Form 1040) if from your self-employment activity.
Technically, it's illegal for the IRS to do so without third parties coming to them or suspicions of terrorism. In practice, they probably rat people out to LE agencies regularly.
If the hacker was entitled to those funds based on the agreement between the concerned parties (implicit OR explicit in the contract) it would not be theft. But it clearly isn't their Ether and the implicit agreement behind the contract stands.
Basically human ethics, morals and the legal system will always trump code.
The comparison to murder doesn't work because you can't consent to murder, but you can consent to theft.
It's not clear to me whether that situation would be taken as consent, but unless you know something I don't, it probably shouldn't be clear to you either.
I mean, legally, what happens is not "consenting to theft". Unlike say assault, which you can consent to, and legally speaking an assault actually happens but consent makes it okay; but with theft, if you consent what happens is not legally theft. (IANAL, but this is my recollection from law A-levels.)
But that distinction is irrelevant here. The point is that there's basically no way for someone to deliberately kill someone and have it not be a crime. But there are ways for someone to take someone else's stuff and have it not be a crime, and one way is if the owner consents.
e.g. Facebook isn't perfect, but it sure obliterated MySpace.
It's true that a system doesn't have to be perfect to win, but I don't see how monero has the edge on any dimension. It's not necessarily the most secure, its not the furthest along in development, not the most user friendly, not the fastest mover, etc. The overall bullishness people have for monero is because its supposedly better in terms of privacy than its rivals. But this is dubious without the right kinds of proofs when the competition does have proofs.