Bitcoin: Decrease in illicit use

For heads of state and conservative bankers, the Bitcoin is a tool for crime. Those who are informed know that most of Bitcoin's transactions are for legitimate purposes. This has always been difficult to prove, but a new study supports this argument.

Bitcoin: more legitimate than you think

War and organized crime are two of the most undesirable elements of our societies. And yet, they both share a positive trait: they are technology generators. Without military research, we would not have access to inventions such as the can, microwave or radar. The encryption, Tor and of course the Bitcoin, owe their use to the darker parts of the Web. A study shows that illicit use of Bitcoin has been declining since 2014.

This is confirmed by a recent study by the University of Sydney. It found that one third of the owners of the digital currency used their Bitcoins for illegal activities. The study states that 34 to 36 million users of Bitcoin have illegally sent or received Bitcoins. However, not all uses of bitcoins on the Darknet are for illegal purposes.

What is illegal use?

Dr. Foley's study does not clearly define what constitutes illegal use. Is buying a gram of cannabis with bitcoins as harmful as buying a firearm or acquiring ransomware? These questions are beyond the scope of the University of Sydney study.

Among millions of transactions, it is impossible to determine the purpose for which a digital currency was used. It is indeed possible to trace the movements of bitcoins, without being able to trace their end use. Dr. Foley, however, studied the issue in detail. By analyzing the flow of bitcoins through known illicit trade networks, such as Silk Road and its successors.

Dr. Foley's research indicates that the illegal use of Bitcoin peaked in 2014 and has since declined. Legitimate use has increased steadily over the past five years and exceeded illegal use by 2016. When the Bitcoin first appeared, one of the few places where it could be used was the Silk Road market where all types of goods could be purchased with bitcoins.
Most early Bitcoin enthusiasts first heard of it thanks to Silk Road. This platform promoted Bitcoin in the traditional media, but also participated in its association with crime.
Six years later, the most famous DeepWeb market was closed by the FBI, but the Bitcoin is still booming.

The American administration "very attentive" to Bitcoin

Licit applications have exceeded illicit applications. But Bitcoin is still associated with crime. When asked about the cryptocurrencies, Sarah Sanders, press secretary at the White House, said that the only U. S. department actively interested in cryptocurrency was the Department of Homeland Security.

However, U. S. Treasury Secretary Steven Mnuchin said his department was investigating illegal uses of Bitcoin. In an interview with Yahoo Finance, Mnuchin said the situation should be looked at "very carefully".

"So we want to make sure that the Darknet is not financed with bitcoins. And that's something that concerns us today." Steven Mnuchin

Mnuchin's comments come shortly after the Treasury revealed a plan to review the cryptos practices of the Financial Crimes Enforcement Network (FinCEN) in the United States.
The revision of FinCEN is included in the annual tax plan for the year 2018, which was published in early November. Although the details do not appear in the report, this is an important step forward.

If a third of Bitcoin users used it to engage in illegal activity, how many users of the dollar did so? Given that 90% of U. S. bank notes are contaminated with cocaine, there is good reason to argue that Bitcoin is the cleanest currency.