Every news story about bitcoins seems to say that people can use it to buy illegal stuff. The more correct ones reveal that anyone can look at the exact history of transactions and trace them all, just not back to people in the real world so easily.
So let me ask...if those morons buying fake and stolen prescriptions and rare illegal dog breeds and stolen art and russian brides and crooked roulette tables and crap get busted by police, all the evidence they need is to boot up their computer and look at their bitcoin app, right? I know you can easily view someone's list of receiving addresses but what about sending? Or is that the same thing? Cuz it sounds to me like that kinda takes care of the problem. Catch someone on a minor offense and go poking around or have an FBI bulletin of addresses to watch out for and give it to all the computer repairers in the world with a reward to report them if found. That'll bust so many people, most of the illegal evil doers will leave the system.
It's extremely hard to convince a jury that an IP address means it was you at the computer doing it. When you're trying to prove a crime, saying it was from "XX.XX.XX.XX" IP doesn't really mean it was you. Now let's convince a jury that an IP is you, and that you sent Bitcoins. Have fun explaining Bitcoins to the jury.
Unless you're a major drug dealer, you're moving $100,000s through bitcoin, no one gives a shit. The amount of trouble, money, it would take to charge someone with the main evidence being IP addresses and "bitcoins" is the equivalent of burning money and they'd probably still lose the case. Big deal you bought 20 ecstasy pills from some dude in Poland. The DEA could bust raves every weekend and grab people for that shit. And it's way easier to prove then IP address + bitcoins = you to a noob jury.
