Comments URL: https://news.ycombinator.com/item?id=35393312

Points: 4

# Comments: 3

I spent a fair amount of time in the gaming business, and I can tell you that this statement is patently false. Very little of it gets caught, because the people involved in such schemes know what the rules are and simply work around them. Casinos themselves also sometimes turn a blind eye to such activity when it is especially profitable for them. Example [1]. That occurred even with the reporting requirements.

[1] https://www.justice.gov/usao-cdca/pr/operator-venetian-resor...

Given that it also has legitimate uses, I think that's a very difficult case to make. Also, with very limited exceptions, nearly all crimes in the US require intent and/or knowing participation. It's a fundamental tenet of our system. There is a reason that they aren't being prosecuted in the US, and those reasons are outlined above. Perhaps Dutch law is different enough to allow a conviction; time will tell.

I'd also point out that Apple's device encryption scheme was specifically designed so that Apple itself cannot unlock devices, which thwarts law enforcement subpoenas for assistance. They can legitimately throw their hands up in the air and say "we have no ability to help you" - and that's by design. It is not illegal to design systems in this way. It just shifts the legal liability for misuse onto the users, where it should be.

I don't know what Dutch law says with regard to intent/knowing participation, but I suspect that any system of laws in a civilized country would generally require it for criminal convictions.

Casinos are used as vehicles for structuring and money laundering every minute of every day - on a much larger scale than anything Tornado Cash could ever have achieved. They don't have the intent to aid in these activities though, which is why they are allowed to operate.

You have a fundamental misunderstanding of US law with regard to money laundering. Obfuscating the source of funds, by itself, is not money laundering. Money laundering requires a "predicate offense" - the money that is being laundered must be proven to have had an illicit source. Further, the entity accused of doing the "laundering" also must know that the source of funds is illicit before doing it. Intent to promote the carrying on of "specified unlawful activity" must also be proven in order for a money laundering conviction to occur. You can read the entire statute here [1].

Therefore, the "chief selling point" cannot be money laundering, at least under US law, because the contracts were deployed with no prior knowledge of how or by whom they would be used. One cannot form intent without prior knowledge. The chief selling point was anonymity, not money laundering, which has a highly specific legal meaning.

[1] https://www.law.cornell.edu/uscode/text/18/1956

I grew up inland San Diego, and I can tell you that our summer days there routinely topped 100 degrees. I agree that if you are fortunate enough to live very close to the water, you do have some weather advantages over Vegas. For me, it's certainly not enough to warrant putting up with the other, man-made issues in California, even if I had a place right on the beach. But I agree that for some people, the (slightly) nicer weather is worth all of the expense and putting up with the nonsense.

Las Vegas is inordinately hot only 3 months of the year. The rest of the time the weather is relatively mild. That's hardly "actively trying to kill you during most of the year". Many people who visit Las Vegas only do so during the summer, so it seems like it's hot most of the time to them, but this is a myth.

Having grown up in San Diego and currently living in Las Vegas, I'm not sure what special advantages you are implying it has that would enable it to be "advantageous to ordinary economic conduct" vs Las Vegas. It's next to an ocean full of water that you cannot drink (without expensive water treatment). Produce is grown in California (with water that it deprives Las Vegas of), but mostly not near San Diego, so it has to be transported in to support its massive population, just like it has to be to Las Vegas. In fact, the agricultural centers of California are approximately equidistant to both San Diego and Las Vegas, perhaps +/- 100 miles.

Even putting aside the other issues with California - overpopulation, insane politics, high crime rates, absurdly high state income tax, high cost of living, etc. - I don't see any serious advantage that Southern California in general has over Las Vegas, unless you just like the beach (and even then...it's a 3.5 hour drive or 30 minute flight to Southern California). In fact, many Californians are starting to realize this, and are invading us.

Comments URL: https://news.ycombinator.com/item?id=31559744

Points: 2

# Comments: 0

You seem to be asking me to defend the merits of crypto, which is beyond the scope of this conversation. But generally speaking, most of the coins people actually buy are tied to protocols that are attempting to do things that interesting to at least some part of the population.

But, the ability to prove the provenance and ownership of any asset, whether physical or digital, has value. The ability to move value across borders instantly, cheaply, and reliably, has value.

In a world where so much has been made of fake news, imagine if you could know with absolute certainty that a given quote you read from someone in an article is authentic and given to the specific outlet you are reading it at, not taken from somewhere else, perhaps out of context. Imagine if Google integrated such information/quote verification into its search results, and could use it to prioritize sites with real quotes or information. SERPs wouldn’t be full of trash, and small sites that manage to scoop large ones could get instant #1 rankings. Authenticity verification has value.

The possibilities are endless.

I agree with you that throwing money at anyone who tells you they can take an unlimited investment and offer compounding returns on it is a recipe for disaster. But in DeFi, intelligence and strategy translate directly to greater yield. Math has proven time and again that those things matter very little in traditional markets.

In the case of flash loans/swaps, the answer is yes. It's 0. Further, I never have any capital at risk, all of my bots use flash loans/swaps. These transactions are atomic, which means that either all parts of it succeed or they all fail (it's a "revert" in blockchain parlance). So I can borrow $200 million without any prior permission and do an arb/liquidation or anything else I want with it for the life of my transaction, with the only requirement being that I must return it by the end. If my arb/liquidation/whatever succeeds and I return the loan, I keep the profits. If not, it's as if the whole thing never happened. The only risk is the transaction fee, which on the chains I do this on are miniscule.

I realize that it sounds unbelievable, but it exists. My code does thousands of these daily. I am not the only one doing this. See https://eigenphi.io/ . With the exception of sandwich transactions, every one of the bots you see on there is making profits without any capital at risk.

There are funds out there that conduct these activities, I know because I recently consulted for one. They are promising risk free returns and getting them.

There are things that exist in DeFi (such as flash loans) that have no real world equivalent, which is why blanket statements made about traditional markets don't necessarily apply. If used properly, these things do in fact offer "too good to be true" types of returns.

The point is that these opportunities exist, and they always will exist, you just have to be smart enough to be able to get into them. If someone needed money for infrastructure to run an arb bot, for example, and offered you above market, risk-free returns, it's at least possible they aren't lying to you. That was my point.

If you believe the statement "if someone is promising you consistent above-market returns it's either a scam or there is unknown or undisclosed risk" it might be true that you don't understand DeFi to some degree. DeFi isn't a single market, it's millions of micro markets that are accessible through what amounts to a single API.

So when you have millions of markets with different returns that can be traded in every imaginable way (and some you probably haven't imagined), throw in an insane amount of dumb money, people willing to borrow at high interest rates (relative to the real world), and a laundry list of factors that introduce inefficiencies into the market, it's quite easy to find pockets of above-average returns if you're smart. I have no idea if Stablegains was actually smart, but it's more than possible to achieve above-market gains in DeFi without exposing yourself to outsized risks.