Hacker News Reader

Comment by dagaci | Hacker News Reader

But isn't the address is published on their website... ?

Destination is ofcourse (which can also be generated new for each donation btw) but what about the source? It could be anyone. There are services and protocol like coinjoin and tumble that will mix transactions, making it further impossible to narrow down on the right source

just because it is published that doesn't mean it's easy to track who the funds are coming from.

In traditional finance there is usually some sort of method in place that directly associates (either concretely as in say requiring an ID or loosely as in just having video surveillance correlated with say a money order or money gram transfer) a persons identity with an account anytime they are conducting any form of financial transaction.

With bitcoin, there is no way to pinpoint exactly who created an address. I can create thousands of wallets, and distribute them to all my terrorist buddies across the world for example, and it's not like traditional finance where i had to get somebody connected to the government (as the banks are) to sign off on me doing that.

The only weaknesses bitcoin has that I can see is

that people's computers are typically less secure and easier to break into than banks who do a good job implementing security, and therefore its way easier to steal..

2. Because its decentralized and entirely electronic based when somebody actually steals your money it is virtually impossible to reverse that without requiring a hard fork of the block chain and for some currencies you just can't do that. (for example, nobody is going to be able to hardfork btc and take over it just because somebody ripped off a $1m worth of BTC from joe shmoe who hadn't updated his Ubuntu PC in 2 months because he's too lazy to type in his password everyday)

And lastly, the fact that bitcoin (and all other currency for that matter) becomes virtually worthless when nobody is willing to give you fiat in exchange for it. There is always going to be a weakness in the fact that these terrorists are going to need to convert their bitcoin into fiat eventually. Realistically, it doesn't actually make any sense why terrorist organizations would do this because of this weakness. You'd have to find a buyer for them who can give you fiat directly without raising suspicion. Which means direct cash exchanges and if you are already at that level of coming out into the open. You might as well just mail people cash using bogus identities and PO boxes.

All this is based on assumption that those "terrorists" exist and need a sophisticated a reliable banking system. A simpler theory is that "terrorists" are state actors who challenge each other to get something practical in return. State actors don't need this bitcoin stuff: they can just send golden bullions in a diplomatic airplane and this transaction will be completely untraceable.

> All this is based on assumption that those "terrorists" exist and need a sophisticated a reliable banking system.

And that they don't have one. They've used the hawala system since pretty much forever.

The second point is true for large quantities, e.g. if they want to cash in on 100MUS$. But they can still pay hosting fees, or send the coins to their friends in western countries to seed propaganda (or worse) there.

//edit: The important thing then is that the coins are not "tainted" as being terrorist donations. With the system described in the article that may be possible.

Reply on news.ycombinator.com