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Comment by arcticbull | Hacker News Reader

> Seems like he could have done more to distance himself.

Bitcoin's public ledger makes transactions into prosecution futures.

This is why it's such a poor choice for revolutionaries and funding the marginalized. You leave a permanent indelible public record in posterity that will in the course of time be de-anonymized, automatically, and traced back to you.

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Is it illegal to sell your artwork at an auction, and a criminal happens to be the one to buy it? I honestly don't know.

is the onus on an artist or on an "auction house" to vet buyers. If post sale it turns out the money was fraudulent, does the artist need to pay it back?

In crypto terms. You the artist simply put a NFT up for auction at OpenSea. You the scammer happened to purchase the artwork on OpenSea. However KYC is not well enforced, enabling for money laundering between the two wallets.

It's not illegal if it's a coincidence, however, that may reasonably be probable cause for investigation, and if the investigation finds out that it's not that the criminal "just happened" to buy it but that you colluded to do that, that's a felony.

I mean art and other not easily evaluated assets are used for drug trafficking and money laundering.

Auction houses are known to be on the trick -- that is passively mainly/ they don't care and work to "pump" the prices of artwork. But of course law enforcement agencies know about it too.

It shouldn't be illegal: people should be free to buy what they want. But let's not hide behind our noses.

This only work because they hire the right lawyers, who dinner with the right persons across all law enforcement branches.

More simply, they might get away with it because, by and large, they're not actually laundering illegal funds, but merely using the exact same tricks to obscure all sorts of socially disreputable but not actually illegal stuff. Of course, there's a real gray area since arguably a lot of disreputable stuff should also be illegal. But by the same token, some people might genuinely want more privacy depending on their circumstances.

Maybe not, but they certainly use art to dodge taxes, which could be framed as fraud, if they were not well covered legally.

> is the onus on an artist or on an "auction house" to vet buyers. If post sale it turns out the money was fraudulent, does the artist need to pay it back?

No. Normally you have to return items that were stolen from someone even if you purchased them without knowing they were stolen. But money is an exception. See:

https://en.wikipedia.org/wiki/Nemo_dat_quod_non_habet

(I don’t know whether Bitcoin would be treated as money for these purposes…)

> If post sale it turns out the money was fraudulent, does the artist need to pay it back?

Maybe? IIRC, if you unknowingly buy stolen property, and they trace it to you, I think you have to surrender it to its rightful owner (without compensation from the police).

I don't think that works with money, though. I can't imagine someone who sold a house to Bernie Madoff would have to give up the proceeds of the sale years later when he is found out to have been running a Ponzi scheme.

They actually did claw back a bunch of the disbursements from Madoff towards the end.

https://www.wilsonelser.com/files/repository/PHLY_Article_Cl...

In a closely related scenario, if you sell a kilogram of gold to a buyer who pays in counterfeited US currency, then the secret service will seize the $50,000 and you will not be compensated.

Doing business with criminals can bite you, even if you were not participating in a criminal enterprise.

I don’t think thats quite the whole story though. The feds would have no obligation to make you whole but you would almost certainly have a civil cause of action vs the buyer for the full amount, if you could ever collect. So don’t do business with people who can disappear or avoid court judgements.

> Is it illegal to sell your artwork at an auction, and a criminal happens to be the one to buy it? I honestly don't know.

Law on receiving stolen goods is vague, complex, and jurisdiction-dependent. But in some cases, if the money you get paid is "the same" money that was stolen (something that's actually much easier to show with Bitcoin, where every input to every transaction is another transaction's output), and you know about the crime, yes. See People ex Rel. Briggs v. Hanley.

It may depend on the particular country, and jurisdictions on the internet are gray areas... That said, in the US if you are paid with stolen money and then informed of that fact then you are knowingly in possession of stolen money and would have to return it. If you no longer had the money (used it to pay bills, live your life, etc) then it probably gets more complicated.

I get what you're doing here, but that's way too many steps. just because bitcoins ledger is open & transparent doesn't mean there aren't a million other privacy focused coins you could swap into leaving the trail cold.

You can walk in the river instead of trying to cover your tracks.

Melania Trump recently did this to her NFT.

https://www.reddit.com/r/CryptoCurrency/comments/sohojt/mela...

To be fair is more of Solana pretending to sell celebrity NFTs by buying them with its own funds.

Yeah somehow those crypto expert on social media don't even think about it, when they shout bitcoin will fix this.

To be fair there are some cc* that try to address this. Apparently signal was forced to choose the relatively unknown MobileCoin exactly to avoid this problem.

*cryptocurrency is too long

> cc*

That’s “credit card”. We’ve already lost “crypto”(graphy), let’s avoid deliberately giving away other common shorthands.

But you could exchange the bitcoin for moneor and then back to bitcoin, and that would make things harder for investigators, right?

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