Bitcoin sheds dark past as crooks turn to other virtual currencies
Bitcoin is no longer the currency of choice on the dark web.
Due to its secure technology and decentralized nature, the early phases of Bitcoin use were marred by mining and using the cryptocurrency for illegal goods. Deep web black markets, like the now-defunct Silk Road, allowed users to buy and sell illegal drugs and other illicit products using digital currencies.
Those dark days, however, are in the past because according to experts, criminals are turning to other digital currencies that are harder to track. A CNBC report quoted a U.S. Homeland and Security official, who said that miscreants are now “looking more closely at other currencies like monero and ethereum.”
Bitcoin’s promise of anonymity is one of the reasons why it became the black market’s currency of choice. But the dark web failed to take into account that the cryptocurrency is built on the blockchain, which is essentially a public record of all transactions on the Bitcoin network that law enforcement investigators can access to track the movement of funds, eventually leading them to catch the criminals as they try to cash out via exchanges or banks.
In Bitcoin’s place are new digital currencies that have popped up over the years, promising increased user privacy. Among these is monero, an open source cryptocurrency whose underlying technology is capable of hiding the name of the sender, amount and receiver.
Law enforcement agencies, however, are getting better at tracking the criminals and holding the exchanges accountable, according to the Homeland Security official.
“I think [Bitcoin’s] a lot more legitimate than people give it credit for,” the official said.
In 2016, researchers found that Bitcoin has already matured to a point that its market no longer relies on illegal activities to drum up business. According to the study, Bitcoin has already passed through “three distinct phases of growth as a distributed payment system,” and its most recent stage has allowed the cryptocurrency to be driven by “legitimate payments, commerce and services,” a far cry from its days spent on the dark side of the internet.
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