Cryptocurrencies like bitcoin sound shady by their very nature, even their choice of name. They remind one of Douglas Adams’ fake intergalactic currencies from that wholly remarkable book The Hitch-Hiker’s Guide to the Galaxy, such as the Triangic Pu. Made up of six Ningis — “a triangular rubber coin six-thousand, eight-hundred miles long each side” — no one has ever managed to collect a whole one.
Actually, quite a few people have managed to collect whole bitcoins (although you can buy fractions as small as one hundred-millionth, called a Satoshi after bitcoin’s mysterious creator). In August 2017 bitcoin’s value had risen above $3,500 and by the end of October it was flirting with $6,000.
Bitcoin, Altcoin and the Dark Web
Not that financial advisers are necessarily recommending that you invest in bitcoin. Not only is it volatile – it went from a value of $1,100 in 2013 to $200 in early 2015 – but it still has a whiff of the illicit. The WannaCry ransomware cyber-crooks asked for payment in bitcoin, and Silk Road drug dealers used it.
In September a blogger who goes by the name Talbot Goes Purple reported how his son was using bitcoin to buy drugs and have them delivered to their house. On the other hand, he was able to discern this by looking at his son’s computer.
The top five Dark Web vendor nations are, in descending order, the US, the UK, Australia, Germany and the Netherlands. Only the Netherlands seemed to have much of an overseas market – and the highest per capita revenues, at least in 2016 – but most vendors seemed to move drugs within their borders. Cryptocurrencies may not be facilitating global markets for drugs.
Is Cryptocurrency Really Anonymous?
Bitcoin in itself isn’t as secret or private as proponents would like you to think (though additional encryption can help). Even when it works, there’s no guarantee that will protect you from low tech. One Dark Web UK drug dealer – who made between £275,000 and £1.5m in bitcoins in less than three years on the Dark Web site, AlphaBay, before being caught – was apprehended not due to computer forensics or flaws in encryption, but because of a tip from his stepfather and a search of his residence. Bitcoin’s protections didn’t save him.
Still, Forbes says bitcoin is still “crushing” other cryptocurrencies, including those which offer much greater secrecy. For example, Monero – which WIRED wrote was the drug dealer’s cryptocurrency of choice in January 2017 – has been fluctuating between $92 and $82 lately. Granted, that’s an improvement over the $12 it was valued at in January, but given the size of the illegal drug market, you’d think it would be growing faster.
Reasons to Use Bitcoin
Bitcoin’s growth probably isn’t linked exclusively to its use in drug deals and extortion (although WIRED did attribute the increase in Monero’s value to its use on AlphaBay). It can be used for other legitimate purposes, even paying for luxury addiction treatment for alcohol dependence, drug addiction or other substance abuse. Its greatest virtue may be its relative anonymity, which appeals not only to criminals but to libertarians, one-world conspiracy theorist and anyone who mistrusts the government in general.
In the case of substance abuse treatment, bitcoin or other altcoin users may just want to keep the evidence of their need for rehab a secret, afraid it will hurt their employment prospects, personal relationships or even liberty.
The Argument for Cryptocurrency
We have less privacy online than we think or would like, but most of us accept that as a trade-off for convenience. Some aren’t so willing to do so.
True, drug dealers, money launderers, and other criminals have used bitcoin and other altcoins, and some have become wealthy or wealthier as bitcoin’s value rose. As another blogger points out, you could argue with as much justification that the manufacturer of the Tesla automobile makes it easier to rob banks.
One pro-cryptocurrency site argues that bitcoin and its altcoin brethren can be used to eliminate money laundering (while admitting a man in Greece was arrested in June for laundering $3 billion).
Locking the barn door after the horses have escaped never works. Neither does outlawing commodities that a significant portion of the population wants, and that another portion is willing to provide. Cryptocurrencies must be dealt with, not banned.
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