The CEO of BlackRock has made the claim that the only reason bitcoin has become so successful is because of its anonymous nature.
Larry Fink, CEO of BlackRock, an American global investment management corporation, said earlier this week that the digital currency remains a ‘speculative’ asset and that it’s a currency that people use for money laundering, reports the South China Morning Post. Speaking at a 2018 Global Investment Outlook Summit, Fink said:
The reason why it does so well is it is anonymous. It’s anonymous, and it’s cross-border. If you legitimise it, you know who your counterparties are … the question is how many people will use it if you have to acknowledge you are a buyer or a seller.
However, while Fink claims that the digital currency is anonymous, this is far from true. At the best of times it can be considered as pseudonymous. This is certainly the thinking of Princeton University researchers who have found that it’s possible to uncover a user’s identity on the blockchain.
In an August report, the researchers said in a note that:
Based on tracking cookies, the transaction can be linked to the user’s activities across the web. And based on well-known bitcoin address clustering techniques, it can be linked to their other bitcoin transactions.
While the digital currency may have been touted as a currency that promised full anonymity to a user in the early days of its existence, that’s no longer the case. So much so, that criminals are turning their attention to other cryptocurrencies for greater anonymity such as monero and dash, according to a U.S. Homeland Security official.
The official said:
What the criminals are starting to see, and some of the trends we’re picking up as well, is that bitcoin also works equally just as much against you as it does for you.
Fink also believes that investors should be focused on traditional investment options such as stocks and bonds rather than the cryptocurrency market. According to him, the world’s economies are enjoying ‘synchronised growth’ for the first time since the financial crisis, adding that bitcoin is ‘is tiny in the scheme of financial markets.’
I don’t know why it has so much fascination for the press.
Despite the fact that bitcoin saw a 29 percent drop over the weekend when it dropped from a record high of $7,800 to $5,500, it is steadily climbing back up in value. At the time of publishing, it is trading at over $7,200, helping to push the combined market value up to $219.1 billion, according to CoinMarketCap.