Option #1 :
I am aware many exchanges/markets do 'bitcoin mixing' to get around this, but the local authority could just as easily subpoena/force someone like mtgox into giving up the info of where the coins are going. As always, the folks who cant hide behind tor and want to appear legit are going to be weakest. (mtgox/bitpay/coinbase/etc..) - Those are the companies that will be 'compelled' to comply if it gets to that point.
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Option #2:
Inspect the packages you receive for fingerprints. You will likely find a postal workers prints and be able to continually track it back to the sourced post office. Then you just correlate the time the package was likely sent and watch security footage, looking for something that matches the shape/look of your package.
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Also- Please dont take the above post too seriously. I have mostly no idea what I am talking about when it comes to bitcoin.
> I am aware many exchanges/markets do 'bitcoin mixing' to get around this, but the local authority could just as easily subpoena/force someone like mtgox into giving up the info of where the coins are going.
The coins are mixed _before_ they arrive to mtgox or some exchange, I would guess.
> Even if you mix the coins a few times through a few sites, its still going to be the best way to find them.
Any arguments here? The authorities would need information from every web site that has been involved with the transfer. The mixers can reside in the tor network, so it is impossible to get the connecting information.
No, you can't. The coins are mixed before they get to mtgox. Mtgox doesn't know where they came from.
In fact, you don't even need to use mtgox. Mtgox is just where you swap bitcoins for cash. If I sold drugs, it would be smart to just keep the money in bitcoins.
And you can also exchange money for bitcoins with an anonymous physical person in your city. Just go to localbitcoins.com, find someone near you with one or the other, and swap with them.
Also, I think its extremely impractical to think that a volume drug dealer is going to do physical exchanges. Even if they did opt for that route- Track the guy he did the exchanges with, then beat him with a wrench to find out who he bought from.
You can mix them anyhow you want. If you know how bitcoin transactions work, the idea is simply to break the transaction chain. There are simpler or more paranoid ways to do it, and of course in Bitcoin world it is inviduals responsibility to handle his own coins.
Edit: think about how someone would try to connect the transactions: timing, amounts, etc.
I find it pretty annoying that there seems to be lot of people with strong opinions about bitcoins, but who haven't really studied it that much...
Where would one start - I would like to buy some and see how it all works, and maybe leave a laptop mining some - but I would prefer to research first - where would I start?
If you want to test out how it works in practice, try playing with instawallet.org , maybe buying small amount of coins and tracking how it works. There are also free bitcoins sites, I don't have much experience with them or either with mining. You can track transactions on blockchain.info
Don't know. BTW almost every web based service is a bitcoin mixer in itself, including exchanges, because it is fairly standard way to implement a hosted bitcoin wallet. Exception might be blockchain.info.
Option #1 : I am aware many exchanges/markets do 'bitcoin mixing' to get around this, but the local authority could just as easily subpoena/force someone like mtgox into giving up the info of where the coins are going. As always, the folks who cant hide behind tor and want to appear legit are going to be weakest. (mtgox/bitpay/coinbase/etc..) - Those are the companies that will be 'compelled' to comply if it gets to that point.
.
Option #2: Inspect the packages you receive for fingerprints. You will likely find a postal workers prints and be able to continually track it back to the sourced post office. Then you just correlate the time the package was likely sent and watch security footage, looking for something that matches the shape/look of your package.
.
Also- Please dont take the above post too seriously. I have mostly no idea what I am talking about when it comes to bitcoin.