Say you buy bitcoin by bank transfer to an exchange. Then send the bitcoin to another address that is not connected to you at all, then transfer to dnm, buy drugs, sell them for cash, deposit it to the bank to buy more btc and repeat.
Could you say you have been buying and selling bitcoin for cash through localbitcoins or mycelium or something so not to have to incur the cost of tumbling? Even make like fake messages on mycelium?
This could work as tumbling and laundering the earnings right?
You would need payments from an exchange to your bank. Or records from LBC, backed up by the blockchain, to show your income from these transactions. And forget it if the IRS is looking at you unless you've concealed the origin well enough and then declared income/paid tax on it, if it is to be truly clean.