The basic misunderstanding is on your part.
“Money laundering” wasn’t mentioned by anyone but you. Stop inventing things.
This is about valve getting fucked because they were accepting bitcoin payments with zero confirmations.
“Money laundering” wasn’t mentioned by anyone but you. Stop inventing things.
This is about valve getting fucked because they were accepting bitcoin payments with zero confirmations.
You brought up the point about zero confirmations. Zero-conf itself is fairly reliable, it certainly doesn't account for 50% transactions being fraudulent. Bitcoin introduced replace by fee in 2016. In 2017, bitcoin transition fees were high, and there was large increase in the bitcoin mempool, which led to a backlog of stuck low-fee transactions.
Replace by fee adds a major loophole to zeroconf, low-fee, stuck transactions could be rebroadcast with a higher fee and sent somewhere else even after they were "received" but not yet "confirmed" by Steam. Users could sign up, pay with Bitcoin, steam sees the payment but doesn't want the user to wait 3 days for confirmation, so steam completes the signup. After that the user rebroadcasts the transaction back to themselves with a higher fee and quicker confirmation. The original transaction doesn't go through.
Here's and discussion on how reliable zero-conf is when RBF is not part of the protocol and instead bigger blocks are mined.
> Zero-conf itself is fairly reliable, it certainly doesn't account for 50% transactions being fraudulent
Of course it does. Someone using this to spend the same bitcoin multiple times will generate many times more transactions than a regular user.
I consider "obtained somebody's credentials or private key through illegal means and then used that to purchase a good with stolen BTC" to be fraud. That the network considers this to be a normal transaction is not relevant.
Don't let bob create a new account with zero games and double spend his way to a free game because he has nothing to lose.
If Sam who has 100 games in his account with 10 year longevity cheats you insist he make good on his transaction or ban his account and don't ever let him create a new one with the same name and billing address. Sam is highly unlikely to value playing a singular game more than his account.
This seems absolutely trivial to avoid problems with.
It works the other way around, people launder funds from steam into cryptocurrency. Either by buying items with stolen credit cards or by stealing steam accounts.
Terrible rate of return, but the rate of return doesn't matter that much if you can't spend the money otherwise.
First, it destroys the traceability of notes (because they go into the FOBT machine with one set of serial numbers and the machine is going to pay out other notes and coins in different denominations). And any cash that investigators are going to track through seizures targeting an organisation gets slowly distributed through a community via its gamblers.
Secondly and more importantly, it provides provenance to the money. The gambling money mules (inveterate gamblers who are often addicts, lower ranking gang members, or the dealers themselves) can now move very large amounts of cash around on the street, because if they are stopped by police with large amounts of cash, they have a receipt to show it is what the machine paid out! The money they are carrying is the proceeds of legal gambling, not the proceeds of drugs. It's cleaned.
Here's one article about it:
https://www.theguardian.com/uk-news/2013/nov/08/gambling-mac...
Things have got a lot simpler for police, because FOBTs are now subject to more restrictions.
(And about time: in the 2015/16 year, individuals lost more than £1000 at FOBTs in a single sitting more than 233,000 times)