Bitcoin bulls are still tearing up the blogosphere. Not content to quietly wander off into their well-deserved rest … zombies … Noooooooooooooooo!
The problem, … has always been how to flush the bad guys out of the system. You can’t stop Bitcoin transactions …, since they don’t take place over a regulated exchange. And you can’t keep shady people from using Bitcoin, since the currency’s anonymity accounts for much of its appeal. The only thing you can do is shut down the places where the bad guys tend to congregate.
Uh, not exactly. Bitcoin’s anonymity isn’t “much of it’s appeal” it is the only appeal for people wanting to actually buy and sell real stuff. Anyone else will buy in as speculation, and either lose their goddamn shirt, or fleece the multitudes. (The Winkelvii come to mind.) But they sure won’t spend them on real stuff very often.
Now Silk Road’s closure (and the fact that the FBI has likely deterred other potential Bitcoin drug kingpins from starting up replacement sites) means that the people fighting to legitimize Bitcoin can credibly claim that the old days of the crypto-currency as a tool for vice are over.
Yeah, like hitting one is going to deter the others. That always works. Ever heard of the “war on drugs”? Great success. Not!
Of course, they should be deterred – big time they should be deterred. Anybody with half their brain still working should know why that is. Funny guy, name of Snowden, leaked a bunch of NSA secrets on PRISM?
Well, see, there’s this thing the NSA is worried about. It’s called money transfers for supporting terrorism. And it just so happens, that metadata can tell you a lot about transactions, even if those transactions are encrypted. And it isn’t like the NSA can’t assign someone to open an account, so they can test their filter that pulls out all the transactions being done on bitcoin websites.
And there’s this other agency too. It’s called the DEA. It’s job is to catch people selling drugs. There’s a lot of overlap between drug money and terrorism money. Perhaps you heard of Iran-Contra? The USA has financed proxy warfare that way too. And one of the things this guy Edward Snowden leaked was that the DEA has gotten secret information from NSA.
So, yeah. D’oh. People using bitcoin to transfer money for illegal goods should worry. A lot.
Bitcoin … is … a great technical achievement built and reported on by nice folks who don’t know what they are talking about.
I’m going to be writing about this next year? I think so. It’s 2013 and … Yeah. I will.
PS – There is a certain panache to writing a post that brings in Snowden, PRISM, the NSA, Bitcoin, and the Winkelvoss twins all in one. I suppose that’s a positive.