Hacker News Reader

> Well, unfortunately you do live in one of those worlds, at least as far as the flow of money goes.

What about people who pay with cash? I know people who use cash for privacy reasons but society doesn't treat them like criminals.

Not necessarily true in the USA. See https://en.wikipedia.org/wiki/Bank_Secrecy_Act#Affected_tran... for example. I can only imagine how suspiciously any normal bank would generally treat a customer that walks in and tries to withdraw, say $50,000 in cash, for example.

For small amounts of cash, it's not a problem. But any cash transaction over $10k must be reported. [1] (Structuring your transactions so as to sneak under the limit is illegal.) The same goes for traveling across a US border with over $10k in cash or cash equivalent.

Even under that level, though, some level of suspicion attaches to large wads of cash. I've had vendors ask for cash payment for things in the $1-5k range, and it was pretty clear to me that they had tax evasion in mind.

[1] https://en.wikipedia.org/wiki/Currency_transaction_report

Yet

> ...being secretive about money flows will always put you in company with criminals.

It matters what is being kept secret from whom. I don't tell the general public about my finances. I do accurately tell the tax authorities what I am required to disclose, and I can back that up by accounting for all (material) transactions that I have made. This is what distinguishes me from money launderers.

It's perfectly reasonable to attempt to hide in a public blockchain while simultaneously maintaining private records and making the appropriate declarations to the authorities.

As you're not an authority, you will never see the legal side of it. But that doesn't put anyone in the company of criminals any more than the fact that you don't publish your finances online puts you in the company of criminals.

> It was much worse for, say, buying a book online. But it was much better for crime, including digital extortion and fraud. It quickly picked up a taint that it's never really been able to shake.

I would argue that it is the most useful cryptocurrency that attracts legitimate and criminal users alike. It's not a "taint" caused by a consequence of some criminal-friendly design. Any higher level of criminality is a direct consequence of being the most used cryptocurrency. If something else takes over, then the criminals will switch too.

I agree that some people have reasons for keeping blockchain transactions private. But criminals have much stronger reasons to keep them private.

The most useful cryptocurrency is not as broadly useful as other means of moving money around. So if it has advantages for criminals, criminals will use it disproportionately. Ransomware generally doesn't take Visa and Mastercard. The Silk Road was Bitcoin's most prominent early adopter. And the early Bitcoin market was also rife with scams, fraud, Ponzi schemes, and all manner of other criminal idiocy: https://www.amazon.com/Attack-50-Foot-Blockchain-Contracts-e...

>>IMHO, lack of anti-crime controls was one of Bitcoin's biggest early mistakes.

Elimination of privacy is not an "anti-crime control".

Much of cryptocurrency's value comes from the privacy it gives its users.

If you can work strong anti-crime controls into a digital currency while still maintaining privacy, I encourage you to do so. Otherwise, anything allowing secret movements of large sums of money will be hugely appealing to criminals, exactly as we saw with Bitcoin.

You must be a joy at parties. Although your last sentence is profound and intuitive advice for startups as a general rule, you must be pretty insufferable in person.