Onion Information

Page Clicks: 0

First Seen: 03/12/2024

Last Indexed: 10/23/2024

Domain Index Total: 84

Table of Contents Introduction The Fungibility Graveyard Wasabi Samourai JoinMarket All CoinJoins Tainted Bitcoin Compliant Mining and “Virgin” Bitcoin General Fungibility Issues Additional Reading on Fungibility Something Missing? Credits Source Image Archive Introduction # Bitcoin is often touted as a fungible and private asset and digital cash alternative, when in fact it is technically non-fungible. Each bitcoin in circulation has a distinct history attached to it ensuring that 1 BTC is not equal to 1 BTC. While coin histories can be somewhat obfuscated with tools like CoinJoin, the fungibility of Bitcoin remains distinctly lacking. This lack of fungibility imposes an immense burden on those using Bitcoin as a method of exchange (MoE), introduces a permissioned and centralized layer to the network, and destroys the confidence of everyone accepting funds in Bitcoin. Many Bitcoiners purport that fungibility can be gained through more users mixing, or by peer-pressuring and boycotting exchanges and services that flag or trace Bitcoin transactions. In theory this is possible (suppose in another universe, everyone mixes), but why leave it up to chance? The Monero community sees fungibility as a basic safety feature. Good tools should include safety features by default, strong enough to withstand both governmental and social attacks. This is far preferable to relying on the good will of governments and regulators, or the peer-pressure of us as users to ensure fungibility of digital cash. Do you really want your coins to be fungible only if everyone in Bitcoin correctly follows a 36h-long privacy guide? Monero relies on privacy by default, for all users and all transactions, to ensure that 1 XMR is equal to 1 XMR, no matter what. Monero is fungible today, not just in a pipe dream. The Fungibility Graveyard # This concern isn’t only a fun thought exercise, unfortunately, as users of Bitcoin privacy tools are being harassed today. Below is a list of sources confirming cases of flagging, denied withdrawals, denied deposits, and censorship by services because of a distinct lack of fungibility within Bitcoin. The list is broken down by the tool or reason for the flagging or censorship. Current confirmed cases: 33 Wasabi # A user’s Binance SGD account is frozen upon attempted withdrawal to Wasabi Wallet for mixing: Twitter Source A user’s Paxful account is frozen upon attempted withdrawal to Wasabi Wallet for mixing: Reddit Source A user’s Bitfinex account is frozen upon attempted withdrawal to Wasabi Wallet for mixing: Reddit Source A user’s Bitstamp account is flagged months/years after withdrawal to Wasabi Wallet for mixing: Twitter Source (deleted after this blog was published) Source Image A user’s BitVavo account is closed upon attempted withdrawal to Wasabi Wallet for mixing: Reddit Source A user’s Paxos account is frozen upon attempted withdrawal to Samourai Wallet for mixing: Twitter Source Wtf?? Apparently you are not allowed to do what you want with your bitcoin once you own the keys. Fortunately that's not how Bitcoin works, but the level of chain analysis here is alarming. What is a correct response? @MartyBent @matt_odell @vandrewattycpa pic.twitter.com/BhMDThLHGc - matt (@mattmcmanny) January 28, 2020 The Ethereum DAO hacker’s use of Wasabi Wallet leads directly to his ID after simple tracing News Source Twitter Source EXCLUSIVE: With the publication of my book today, I can finally announce: in the course of writing my book, my sources and I believe we uncovered the identity of the Ethereum's 2016 DAO hacker. Laura Shin (@laurashin) February 22, 2022 Twitter Source demonstrating tracing An article published this morning by @laurashin has raised a lot of questions about the ability of Chainalysis to "de-mix" Wasabi Wallet transactions. https://t.co/hZL5lmkeAN - LaurentMT (@LaurentMT) February 22, 2022 YouTube source demonstrating tracing Wasabi Wallet announces they will start censoring mixing inputs to prevent certain users from mixing their funds Twitter Source The zkSNACKs coordinator will start refusing certain UTXOs from registering to coinjoins. pic.twitter.com/X3kBuQwieO - Wasabi Wallet (@wasabiwallet) March 13, 2022 Telegram Source A user’s Gemini account is frozen after previous transactions with Wasabi Wallet were discovered upon review of his account: Twitter Source Have you seen exchanges fight against mixing services @ODELL @citadeldispatch ? My first time. (This was sent to me from a friend). Why the hate for privacy @Gemini @cameron @tyler ? pic.twitter.com/MPmvN37CVb - Ben Jackson (@bjackson2718) May 18, 2022 Samourai # A users’s Bottlepay deposit is rejected/returned upon depositing mixed funds: Twitter Source (deleted after this blog was published) Source Image JoinMarket # A user’s BitMEX account is flagged months after withdrawal to JoinMarket for mixing: Twitter Source Got an e-mail from @BitMEX about old #Bitcoin deposit transaction (last summer) that "may be connected with activity that is against 1.1(a) of the HDR Terms of Service.", it was @joinmarket coinjoin. #privacy - ₿ Lord Kristaps Kaupe  ($ is for sats) (@kristapsk) March 23, 2021 Giacomo Zucco has JoinMarket post-mix funds frozen by Volet.com. Twitter Source Volet.com’s response All CoinJoins # Multiple user’s deposits are flagged by BlockFi upon depositing from a CoinJoin tool like Wasabi: Twitter Source (Source is now deleted) Source Image Response from BlockFi A user’s loan is closed while under water (causing a loss of 50%) due to the previous owner of the coins using a mixing service or tool: Twitter Source Another happy BlockFi customer. pic.twitter.com/ljwodJR4r0 - Bitfinex'ed 🔥🐧 Κασσάνδρα 🏺 (@Bitfinexed) February 5, 2022 Reddit Source A user’s account is flagged upon mixing coins after withdrawal from Voyager: Twitter Source Didn't close the account, but received a warning from @investvoyager for mixing coins _after_ withdrawing from their exchange. Add them to the list of enemies to privacy. They claim it's against their T&C, but it's not. Not illegal either. Thus, enemies of privacy. Domingo Guerra (@sundaywar) March 2, 2021 Paxos official statement on handling of Bitcoin with a history of CoinJoin: Twitter Source (now unavailable) Source Image A user’s account is frozen due to 6mo-old post-CoinJoin transactions by Bitwala: Twitter Source (tweet is now deleted) Source Image Swan’s custodians terminate accounts of any user who directly interacts with a mixing service “such as Wasabi, Samourai, and similar services:” Twitter Source Swan’s response Tainted Bitcoin # A user receives tainted Bitcoin that cause two exchange accounts to be locked upon deposits: Bisq Source A user is attacked by the media upon receiving a donation from a “far-right” donor: Twitter Source Another day, another sender and receiver of #Bitcoin unmasked because of the lack of default privacy. Thankfully Luke Smith, a well known privacy and FOSS advocate, has been moving towards #Monero with his recent content so hopefully this won't be an issue much longer for him. pic.twitter.com/OpLXWxqRwq - Seth For Privacy | #FreeSamourai (@sethforprivacy) March 13, 2021 Multiple user’s exchange accounts are closed after making a donation to a dark-net researcher: Twitter Source WARNING: Two of my donors report that their exchanges blocked their accounts after they donated Bitcoin to me. I am a journalist! I do not commit crimes. Last year I voiced strong opposition to blockchain analysis. My donation address was flagged in return. This is pure evil. https://t.co/EzZK7sa5Lg - dark.fail (@DarkDotFail) February 9, 2021 A user’s account is closed by LocalBitcoins after sending funds directly to a DNM: Reddit Source A user is worried about accepting donations from unknown sources because of a lack of fungibility: Reddit Source 28 cryptocurrency addresses (including Bitcoin) are sanctioned due to alleged use to fund Russian operations: Government Source Bitcoin donated to the “Freedom Convoy” in Canada is blacklisted and frozen at centralized exchanges News Source Twitter Source Bitcoin raised to support protesting truckers in Canada has been on the move, in defiance of the authorities’ orders to freeze funds, blockchain data shows. Some of it landed at @coinbase and @cryptocom @baidakova reports https://t.co/pkStNZ8vny - CoinDesk (@CoinDesk) February 22, 2022 News Source on addresses sanctioned Twitter source on addresses sanctioned Canadian authorities have ordered financial institutions not to interact with 34 different crypto addresses tied to the country's ongoing trucker protests. @Aoyon_A @realDannyNelson report https://t.co/WFPN0gEHhQ - CoinDesk (@CoinDesk) February 16, 2022 A user’s Bitcoin is frozen by FixedFloat.com due to suspected illicit acquisition (hack/theft) Reddit Source - Response by FixedFloat Reddit Source - Further detailed response by FixedFloat on the traceability of Bisq Source Image A user’s Coinbase account is frozen and then shut down due to tainted transactions from 2y prior Twitter Source (user’s account was suspended after this was added to the post) Source Image Compliant Mining and “Virgin” Bitcoin # Marathon Digital Holdings Inc. launches a mining pool “that is fully compliant with U.S. regulations, including anti-money laundering (AML) and the Office of Foreign Asset Control’s (OFAC’s) standards”: “We believe that such regulatory compliant mining will allow us to produce ‘clean’ Bitcoin.” “On May 1, 2021, Marathon will begin directing 100% of its hashrate to the new mining pool.” “By 2022, Marathon expects to have deployed 103,120 miners to direct 10.37 exahashes per second, or EH/s, to the mining pool - equal to roughly 6.4% of the Bitcoin network’s current combined hash rate.” “[Will] be the seventh largest bitcoin mining pool in the world.” News Source First compliant block mined List of compliant blocks mined by MARA Pool w/ block template comparisons Twitter thread with details on the first 10 compliant blocks 1/ A quick thread on “compliant” blocks mined so far by MARA group. It’s important to remember that missing transactions are not necessarily censored, but could just be due to propagation delays or other normal network behavior. Seth For Privacy | #FreeSamourai (@sethforprivacy) May 14, 2021 Blockseer launches compliant Bitcoin mining pool that only mines approved and filtered transactions: “Blocks posted to the Bitcoin blockchain by Blockseer’s pool will only contain filtered transactions using Blockseer and Walletscore’s labeling data, along with verified sources such as the United States OFAC blacklist for crypto.” News Source Bitcoin mined in China or via fossil fuels are not acceptable to institutional investors: “If you don’t want to own China coin-also being called ‘blood coin’, which sounds like blood diamonds-you’...