Using Bitcoins for illegal transactions was sadly a trend a few years ago, but it’s actually about to change right now, since everyone’s attention is turned to the virtual currency. Soon, criminals might not be able to use it anymore for harmful purposes, because it’s about to be highly controlled by various governments in the world.
The Bitcoin popularity perceived as a red flag
We had several economic crisis to worry about over the last decades, and all of them were preceded by a gigantic economic bubble that eventually burst. Actually, many economists and market specialists have good reasons to be afraid of the Bitcoin, as it shows the signs of what might be the largest economic bubble of history. In less than a year, its value went up to 2000% of its initial price, and it is something that never occurred for a virtual currency.
Various countries publicly expressed their concern about the Bitcoin, and France is among them. The French Minister of Economy intends to discuss the possibility of a regulation of the currency during the next G20 summit. His goal is to convince the other countries to come up with a legal instrument whose purpose is to keep track of how the Bitcoin is used within a country’s borders. The initiative to do so was emitted first by Belgium, a fierce activist when it comes to war against money laundering and terrorism.
Germany and Italy are the European countries who already followed the lead, and they mentioned to be busy investigating the various risks of the use of the currency on the long run. Some countries, like Russia and China, even went further, and literally banned the Bitcoin from their borders. In Israel, Shmuel Hauser, headmaster of the ISA, expressed his intent to submit a ban of the cryptocurrencies from the Tel Aviv market.
Aiming an efficient fight against illegal funding
The economic bubble isn’t the biggest issue with cryptocurrencies, when criminals use them for illegal purposes. It’s very easy for them, since currencies like Bitcoin allow a complete anonymity, and this started to be a serious issue for governments. Exchange platforms might soon be advised to communicate the identity of their customers when they’re required to. This could help prevent a misuse of the cryptocurrency, for example for activities such as funding of terrorists organizations.
One way to keep track of the illegal transactions of Bitcoin is to request the identities of the Bitcoin users whose volume of Bitcoin exchanged exceeds a specific threshold. However, even if no one came up with any similar initiative, criminals are already leaving the Bitcoins for other options, like Darklaunder, a dark web money laundering service, or other currencies like Ethereum and Monero.
The Bitcoin linked with illegal activities in the past
The hidden part of internet is a dark place where the darkest transactions between the wickedest people take place. Since it is too risky to use online banking and cards for such illegal payments, they had to come up with alternatives, and at the time, Bitcoin was the best option possible. Its principles core allowed it to be the perfect tool for illegal payments, because transactions could happen between two Bitcoins without any of them having to mention their identity.
2014 was the year during which the illegal use of Bitcoin hit its highest peak, but such transaction volume started to drop down starting from there. Only two years later, the legal users of Bitcoin surpassed the illegal ones in transaction volumes, and now it is even lower, as only 3 to 6% of Bitcoin transactions are said to be illegal.