EU officials still have not decided how to treat bitcoin. The technology underlying cryptocurrencies, like politicians, and they are ready to use it, but with bitcoin, things are different. The authorities never tire of repeating that bitcoin is used by criminals for money laundering and financing of terrorism.
Over the past few weeks the European Commission made two completely opposite statements on this issue. Whether bitcoin and its underlying technology tools for money laundering or they can be used to ensure the controllability and accounting? Which of these statements is true?
Blockchain good, bitcoin bad
1 February in Brussels, the European Commission launched the project «Blockchain Observatory forum». The program is designed to «identify the key technology of the blockchain, the promotion of European industry and strengthen contacts with shareholder companies of the blockchain». In a press release quoted the words of the Vice-President Digital Single Market Andrus Ansip (Andrus Ansip): «Technologies like the blockchain may help to reduce costs and increase reliability, traceability and safety».
However, the press release makes no mention of bitcoin or other cryptocurrencies, although its existence in the blockchain owes the invention of digital currencies. On the other hand, speaking about the benefits of the blockchain, the European Commission is not obliged to praise bitcoin, and the fact that the main legislative body of the European Union provides support for a distributed registry, already a good sign.
Paradise for money laundering?
In late January, the police service of the European Union (Europol) held a meeting devoted to measures to combat money laundering through crypto-currencies. During the event, representatives of Europol said the increasing incidence of the use of cryptocurrency for criminal purposes, including terrorist financing.
This statement is contrary to a recent report, which stated that the number associated with the illegal activities bitcoin transactions decreased by 0.61% and for the period of 2013 it declined by 40%. Undoubtedly, the criminals continue to use bitcoin and other cryptocurrencies for money laundering in the same as regular money, however the volume of this use is questionable.
Of course, to move illegal funds on the blockchain much easier than trying to transfer millions of dollars between banks. However, to hide the route of movement of these funds on public registers is almost impossible. Criminals are beginning to understand that, in reality, crypto-currencies are not suitable for money laundering. Despite the existence of ways to the partial masking of the original source of funds in the cryptocurrency to implement it on a large scale is extremely difficult. As noted in published this week by the European Union release, the blockchain is an excellent way of storing information. Considering the above-mentioned European community «a high level of traceability and security», the question arises whether «bitcoin and associates» are at the center of criminal activity, as they are often called.
Perhaps the interpretation of two conflicting statements Europol and the Blockchain-the Observatory and the forum of the European Commission depend on the needs of different departments. The interests of law enforcement agencies is a matter to reveal criminal activity on the Internet, but threat reduction could be described as an effective results against it. Similarly, for the blockchain incubator interesting to focus on the advantages of technology, without mentioning its shortcomings. The truth is somewhere in the middle: at its core, the blockchain is neither bad nor good, but can be used for various purposes.