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The original was posted on /r/monero by /u/gr8ful4 on 2024-03-24 18:50:14.

It is an excerpt of this post

It’s time to talk about state attacks

This was first published in the Journal of Cybersecurity [Back-up link]

In this paper the authors are broadly talking about risks stemming from routing around AML and weighing AML vs “privacy rights” (GDPR) from a state perspective. As many here know, AML/KYC has never been intended to stop money laundering (at least not within government and the big banks). It was always a measure of control to ensure that normal people like you and me have no easy way to off-shore their wealth.

Now enter the crypto era where suddenly, according to the words of Obama “Everybody is running around with a Swiss bank account in their pocket”. Now that’s an outrageous scenario, isn’t it? Imagine free constituents taking care of their own financials without anybody else snooping on them.

In the paper the authors have been classifying the following three coins along certain criteria involving AML/KYC and GDPR compliance, which they define as “good”.

  • Bitcoin (good*, but likely not GDPR compliant*),
  • Zcash (good) and
  • Monero (bad, because not AML/KYC compliant).

Now let’s jump to the interesting part, where things get really exciting.

Monero as classified in this paper is seen as a risk to public safety and hence deserves to be state attacked.

Quite a few mechanisms are described in that article that many here suspected for a long time (e.g. price suppression, network attacks,…).

To quote the paper:

“A set of tools to combat privacy-coins may include means of a different technological, regulatory, economic (fiscal) nature, also including state attacks on underlying privacy-blockchains. The letter tool, as possible regulatory access points of the blockchain space, was already mentioned by Finck [16], however, without further analysis in that domain. The AML/CFT measures should concentrate on the cryptocurrency of indicated networks, instead of targeting the people who are members of their communities. The tools can and should aim towards reducing the particular currencies’ value, consequently inducing a voluntary outflow of their users.”