The reputation that Bitcoin (BTC) has garnered over the past year has been a bag of mixed sentiment.
In one news report, there will be information regarding to the widespread adoption by merchants and technology enthusiasts calling it the wave of the future. In another news article, there will be updates on a recent criminal investigation involving bitcoins and that the virtual currency can’t be accepted because of its involvement in illicit transactions.
Due to the recent cyber attacks, the arrest of Silk Road’s Charle Shrem and newest regulations in the state of New York, many have questioned the future of bitcoin: is it here to stay or is it a volatile currency that will just be a footnote in history? The answer really depends on who you peg the question to.
For some reason or another, those who oppose bitcoin tend to believe that bitcoin was designed by nefarious delinquents looking to evade the United States dollar for their illegal wheeling and dealings. They, including central banks and public officials, usually point to Silk Road as their primary source that bitcoin is for drug dealers.
It’s true that bitcoin has been involved in illicit transactions. It’s true that more and more criminals are using bitcoin. It’s true that bitcoin is used for illegal actions because of its anonymity. But what about fiat money?
In the 1939 James Cagney film ‘The Roaring Twenties,’ the mobsters didn’t peddle prohibited alcohol on the market in exchange for fairy dust or leaves. Instead, they sought to obtain as much as cash (dollars) as possible. In the 1973 Paul Newman, Robert Redford motion picture “The Sting,” the con artists didn’t attempt their cons for booze or cutlery. No, they wanted to garner more money.
Currency, whether it’s dollars or euros, bitcoins or litecoins, is just a tool utilized by organizations for exchanges. A customer wants a drug; the supplier exchanges the drug for a dollar or a bitcoin. It doesn’t matter what is used in the end.
Should the dollar be abolished? In today’s economic climate and toxic monetary policy, that may be a good idea!
Brian Klein, former Assistant US Attorney and Chair of the Bitcoin Foundation’s Legal Advocacy Committee, might have defended the bitcoin community the best when he said the following in a statement issued last week:
“I think probably the US dollar is used for more criminal activity than any type of currency in the world.”
Criminals using bitcoin might also be coming to an end. A new Bitcoiners say digital currency is a tool not a criminal associate report by bitcoin experts says it has become a lot more difficult for criminals to use bitcoin for “high-volume illicit use such as money laundering.”
“For criminals, this centrality presents a unique problem: if a thief steals thousands of bitcoins, this theft is unavoidably visible within the Bitcoin network, and thus the initial address of the thief is known and (as most exchanges try to maintain some air of reputability) he cannot simply transfer the bitcoins directly from the heft to a known exchange. While he might attempt to use a mix service to hide the source of the money, we again argue that these services do not currently have the volume to launder thousands of bitcoins.”
The bitcoin is just a currency that happens to be used by criminals. Bitcoin is also used by businesses, charitable organizations, merchants and consumers looking to exchange their own goods and services (or perhaps even “tipping”).
When it comes to cyberattacks and virtual heists, well, that might be a different story entirely from this narrative.
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