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Comment by sk5t | Hacker News Reader

Is this high-class money laundering, or something else?

Or a high class form of pump and dump. "Sell" a worthless digital asset to an accomplice for a crazy sum of money, refund the money under the table, and use the resulting press to sell more worthless digital assets to gullible marks.

It doesn't need to be that explicit. There's no doubt a group of people who already have large crypto holdings and who stand to make even more if NFTs take off. They can just buy and sell things amongst each other.

Indeed. What’s 60m for a cryptowhale who might make or lose that much with BTC daily moves.

Sure but you have to really trust each other. Oh wait, it can all be the same person!

This seems more plausible than money laundering. Probably also with physical art.

What's really interesting are the terms of any payment made using Ether:

"Please note that you may elect to make payment of the purchase price for this lot in the cryptocurrency Ether. Payment in Ether must be made via a digital wallet transfer of Ether to Christie’s. The digital wallet must be maintained with Coinbase Custody Trust; Coinbase, Inc.; Fidelity Digital Assets Services, LLC; Gemini Trust Company, LLC; or Paxos Trust Company, LLC. Only Ether payments sent from digital wallets maintained at these platforms will be credited towards this lot purchase, and we will not recognize payments from digital wallets hosted at other exchanges or self-hosted wallets. The digital wallet must be registered to you, or, if you registered a bid as a company, then in the name of the company. You agree, upon our request, to provide documentation confirming that the Ether payment was made from a digital wallet registered in your name and maintained at one of the platforms listed above. Partial payments of a lot from multiple digital wallets will not be allowed."

It should be noted that all of these exchanges are US-based and comply with all know your customer and anti-money laundering laws, rules, and programs.

Doesn't mean that money laundering is impossible (US-based banks do it everyday) but it's interesting that they will take Ether but only from an extremely narrow list of whitelisted source Ether addresses.

Also makes you wonder what happens if you (somehow) send $70,000,000 to Christie's Ether wallet from a non-approved address. Presumably they wouldn't touch it and transfer it back but I suppose you never know...

> "makes you wonder what happens if you (somehow) send $70,000,000 to Christie's Ether wallet from a non-approved address"

Probably no different from sending an unagreed wire to their bank account? They'll just refund, maybe subtracting $50 for "processing" or whatever.

I doubt it. That would mean getting their hands dirty with potentially illegal funds. If I was Christie’s I’d print the key on paper, send it to City’s most expensive lawyer firm, and delete any backups of the key.

Given that on https://onlineonly.christies.com/s/beeple-first-5000-days/be... they mention that they accept Ether, but only if it comes from an identifiable account at CoinBase or a few other exchanges (specifically not self-hosted wallets) it sounds like they're explicitly trying to avoid being used for money laundering.

If you wanted to launder money there surely has to be more discreet ways than making a highly unusual sale worth millions?

Not always, property in london is a way to launder money, thats pretty public.

Artwork has always been a popular way to launder money. Since its value is entirely subjective.

How does it work? Say I have $1 million dollars I need to launder. How does me buying or selling some artwork at an inflated value clean the money?

Because it obfuscates the purpose of your money.

So say you have $1MM of dirty money.

You go pick up a random painting, or scribble on some canvas yourself. Then get your art appraiser friend to say your painting is worth $1MM.

You then sell that painting at auction to another friend for $1MM. Cash only. Private transaction.

But the cash never actually changes hands. Your friend gets the painting, and you claim that the $1MM of dirty cash you had laying around was instead proceeds from the art sale.

Now there are tons of other examples out there with different methods. But it generally all comes down to selling an object that cannot be objectively valued for an all cash price.

>You then sell that painting at auction to another friend for $1MM. Cash only. Private transaction.

But that doesn't really solve the problem. Now rather than you having to explain to the IRS/FBI how you got that $1M bag of cash, your friend has to. It's really not any better than taking that $1M bag of cash, and using it to directly buy whatever you want (eg. a mansion).

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