- October 9, 2018
- Posted by: Bitcoin Center NYC
- Category: The Latest Bitcoin News
One of the most stigmatizing aspects of bitcoin has been its initial association with a poor illegal to legal use ratio. Many continue to attack the world’s first digital currency for this ratio as if it remains the same today. A Drug Enforcement Administration (DEA) special agent, however, who has been studying the area since the early days of bitcoin, has shed light on where the cryptocurrency stands today. Essentially, the ratios have flipped.
Lilita Infante, of the DEA’s Cyber Investigation Task Force, spoke with Bloomberg about the shifting landscape of bitcoin as she has studied it over the past five years. Initial data indicated that criminal activity was associated with about 90 percent of transactions five years ago. Today, that criminal activity has reduced to about 10 percent.
Because the ratios flipped, however, does not mean that less money has been spent on illegal activity. “The volume has grown tremendously, the amount of transactions and the dollar value has grown tremendously over the years in criminal activity, but the ratio has decreased,’’ said special agent Infante to Bloomberg in an interview at her office in Weston, Florida. “The majority of transactions are used for price speculation.’’
It always seemed an odd criticism that bitcoin was used to facilitate illegal activity when any currency facilitates illegal activity. There are varying pros and cons for choosing fiat versus digital currencies to conduct illegal activity; but no one method of payment reigns more supreme than the other. Some critics often imply that bitcoin transactions are completely anonymous and can not be traced. This, however, over extend the concept of an anonymous wallet address as it is presented and relates to a decentralized public ledger. If one knows the owner of a wallet, one can then track payments to and from that wallet. Moreover, a criminal choosing a cryptocurrency would most likely, today, opt for a privacy coin which uses various methods for posting a public transaction yet protecting the identity of the original wallet address and the receiving wallet.
Stigmas change with time and with greater adoption and understanding will come more constructive criticism. It is important for people to understand that criminal activity is an unfortunate reality for bitcoin as much as it is for PayPal or in person fiat transactions; however to claim that “bitcoin is for criminals” is not a factual statement or informed criticism.