FxWirePro: Unearth truth from myth - Cryptocurrencies’ smudged anecdotes on money laundering

In this write-up, we are just emphasizing on bitcoin being unfairly blamed for money laundering, unlike other fiat money.

In the very recent past, Vancouver cops raised a caution of concern over organized crime to launder money through leading cryptocurrencies such as bitcoins unless more control points are implemented to access accounts and monitor those which functions through ATMs. Well, what would be usual sentiment when we read the above lines? Yes, quite common consensus is that panicky situation but we are missing out the latter part of the condemnation which states us that regulatory frameworks are needed in newly invented avenues of money.

Despite the dozens of benefits that Bitcoins and the Blockchain technology have to offer compared to the traditional banking system, there is a risk that Bitcoins can be used for money laundering.

For bitcoin haters who perceive BTC is the source of money laundering: Conventionally, on overseas transactions, relying on intermediaries like the Swiss Banking System, while stirring and routing huge sum of money across the globe has been a very complex procedure. Traditionally, Switzerland used to render banking confidentiality that dates back to the middle ages. This system was codified in the Banking Law of 1934. As a result, Switzerland became the major spoc of for tax evaders.

However, scenario seemed likely to change as a multi-billion dollar tax evasion case probed by the Federal Bureau of Investigation (FBI) which involved the Swiss bank UBS. The incident led to stricter money laundering laws for the Swiss banking industry along with more authority to regulators.

Hence, the tax evaders seek alternatives for laundering money like cryptocurrency gamut. It seems quite unfair to blame entire cryptocurrency industry that eventually provides transparency.

The Chief Scientist of Quebec, Rémi Quirion, has recently published a document declining the popular “myth” that illicit transactions are among those for which bitcoin is principally used.

The document demonstrates the research conducted by Quebec’s Chief Scientist on the “Centre for Sanctions and Illicit Finance of the Defence of Democracies Foundation” that, after analyzing bitcoin transactions executed between 2013 and 2016, found that only 0.61% of trading transactions in the period were deemed to be associated with illegal activities.

The Chief Scientist also discloses their inference on illegitimate transactions within the Bitcoin economy are extremely centralized, further undermining the suggestion that illicit activities saturate the bitcoin economy. It also indicates that less than 10% of anonymous free markets were responsible for 95% of illicit transactions involving bitcoin between 2013 and 2016.

It is clear from the research that the associations between tax evasion and bitcoin, quoting Canada Revenue Agency Communications Officer, Karl Lavoie, as stating “It’s just like money and you have to declare what you’re doing with it.”

Hence, the tax evasion and money laundering seem to be anecdotal on cryptocurrency networks, instead, a fair regulatory system to address money laundering is the essential thing. In fact, bitcoin renders transparency, it would be very convenient to figure out all the people trading on an online exchange or portfolio platform.

Currency Strength Index: FxWirePro's hourly USD spot index is inching towards 145 levels (which is highly bullish), while hourly BTC spot index was at 126 (highly bullish) while articulating (at 07:44 GMT). For more details on the index, please refer below weblink:

http://www.fxwirepro.com/currencyindex.

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