Cryptocurrency and criminal activity seem to go hand in hand

Despite countless examples to the contrary, many people still throw cryptocurrency and criminal activity in the same field. But was born out of ignorance or done? We all fear the unknown. Maybe it's partly because, for the layman, digital currencies suddenly seem to take over.

Despite proving that cryptocurrency is more than evading taxes, why do so many people still make the connection between Bitcoin and nefarious actions?

The Silk Road

If The Silk Road conjures up images of an ancient trade route between East and West, and of intrepid adventure-hungry merchants, your version needs a little update. Many people think of cryptocurrency and criminal activities because of The Silk Road website that uses Bitcoin as its primary currency.

It was an online market to buy and sell drugs, weapons and all illicit things on the dark web. In addition to arousing the popularity of Bitcoin, The Silk Road has also tainted its reputation. Just like that ex-toxic lover you knew hurt, Bitcoin and The Silk Road could not be separated.

When Bitcoin hit parity with the dollar in 2011, buying and selling on The Silk Road was easy. He was also relatively anonymous, until the feds started investigating, finding and prosecuting criminals, and the website was closed. But the stain on Bitcoin's reputation has survived.

Computer crime

Are cryptocurrencies and cybercrime synonymous?

Another reason why people associate cryptocurrency and criminal activity is cybercrime. Unfortunately, being natively digital, cryptocurrencies like Bitcoin it quickly became the payment method for cybercriminals when using Ransomware. Since there is no physical position linked to a cryptocurrency portfolio, the perpetrators are much more difficult to trace.

Think of Bitcoin and other cryptocurrency portfolios as the cyber equivalent of an offshore account in the Cayman Islands. The pushers and cheaters have used those for many years, now they are only on the net.

However, since then Bitcoin is not as anonymous as people thought, the kicker comes when criminals try to convert their Bitcoins into dollars.

Obviously there are alternative solutions, such as cryptographic exchanges with cryptography that do not require users to create an account. In the United States, the KYC and AML protocols are effectively preventing this type of transaction. But many other countries still allow them to be anonymous.

Cryptojacking is another problem that is looming bigger and bigger in the area of ​​computer security. While the intent of hackers is to use computational power for my cryptocurrency, in order not to steal the funds openly, they are still stealing electricity and slowing down the devices. All while accumulating millions of dollars as Monero coins.

Most companies are now a step ahead of cryptographers. They are using effective patch management and improving employee IT hygiene. Individuals can also protect themselves by installing adblockers and antivirus programs. But this does not stop the ingenious hackers from becoming more creative every day, using a free WordPress design or malicious advertising.

It does nothing to help separate the association of cryptocurrency and criminal activities.

anonymity

There is no one who wants to remain anonymous as a gangster or a mafia thug. After all, the most honest citizens have no qualms about their data. Unless it is used without their knowledge companies like Facebookit is generally not essential for them that their transactions be kept hidden.

The fact that some cryptocurrencies are anonymous gives rise to the public association of cryptocurrency and criminal activity. The fact that a person's details are replaced by account keys is certainly an enabling factor for many types of criminal activity. This includes tax evasion, the purchase of illegal goods, money laundering and even capital flight.

Many people have so far used cryptocurrency to send large sums of money out of their country. Moreover, the sources of the amounts could be unknown, unlike a bank that requires customers to justify the source of the funds.

Yet many argue that anonymity and privacy are a right of a person. And actually, Bitcoin was born as a response to the 2008 financial crisis. That was probably one of the darkest holes in criminal activity ever seen.

Bitcoin was born thanks to the widespread corruption of agencies and centralized governments. And the first developers of cryptocurrency identified as cypherpunk, argue that privacy is necessary for an open society in the electronic age.

Ironically, fiat currencies are much more suitable for money laundering than cryptography, with the American Dollar be the criminal name of the choice. In reality it is much easier to leave traces with dollar bills than using cryptocurrency because your digital space is almost always traceable.

Scams

Howey Coin, a SEC "scam" to help teach investors a lesson about the dangers of ICO fraud.

Rather than talk about everything ICO of successthe titles pay much more attention to the cryptocurrency scams. The large public not involved in the sphere of cryptocurrency might not hear about it charitable donations done in Bitcoin, or Ethereum that builds a decentralized world. But they hear it 10 percent of all ICO funds were stolen in 2017. Or the one over 80 percent of all ICOs are scams.

ICO scams are such a big problem that the SEC released one to demonstrate the ease with which these scams fall and to educate investors. With regulators beginning to pay more attention and becoming more strict with ICOs, the number of scams should start to decline. And with companies like Google and Facebook that prohibit ICO advertising and celebrities starting at approves less ICO (including "Shitcoin Shiller" John McAfee), other investors could be saved.

But ICO scams are yet another trigger for cryptocurrency and the association of criminal activities. And scammers always find a way around the bans of ads, using social media and offering to send Ether to those who send them first to them.

You have to admit it, it's hard to have sympathy for the kind of person who would fall in love with a scam so obviously evident, yet there were a lot of unfortunate victims. This scam has caused many high-profile cryptographic names to include "not giving away ETH" after their name. Just check Vitalik's Twitter.

Vitalik "Do not give Away ETH" Buterin

Cryptocurrency and criminal activity: the association lives

The lack of regulation so far has led the criminal association to reach the feverish level, with the cryptic space often referred to as the Wild West. However, regulation is starting to appear in various forms around the world this year.

In the United States, the SEC is calling on all exchanges to register as stock exchanges. Around the world, other countries are developing legal frameworks to protect investors without limiting innovation.

We will always associate large amounts of cash with criminals. But as people become more informed about cryptocurrency, it is hoped that the instinctive reaction to its crime will start to dissolve. And already, there seems to be a change in the air.

That said, it is inevitable that criminals use cryptocurrencies for nefarious actions, as long as there are criminals in our world. In the same way they will continue to rob banks, kill each other and start wars. We do not associate large banks with criminal activities even after 2008, so maybe it's time to free the cryptocurrencies.

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