Last updated on January 2nd, 2018 at 12:00 am
We already know that Bitcoin is the major currency in the website Silk Road, where you can buy almost everything that’s illegal like heavy drugs, pills or guns. We talked about this website before and, although the platform is far from the normal online business, it’s no match to money laundering schemes like the one that dictated the end of Liberty Reserve.
Silk Road might be unregulated and sell illegal items, but the website deals with relatively small transactions, so we can’t really talk about a large criminal operation supported by Bitcoin. And that is good! For once, the many flaws of digital currency can be considered positive.
Bitcoin is volatile and unregulated. Through this point of view, it’s obvious that Bitcoin isn’t suitable to please the big bosses of virtual crime. Another feature of Bitcoin is the fact that, today, the cryptocurrency has a high profile and is well-known by governments and authorities.
According to Alphonse Pascual, an analyst for Javelin Strategy and Research, “big time criminals are businessmen, so they want to protect their investments, protect their profits, and Bitcoin is too unstable to do that“.
People can always argue and say that Silk Road has gotten around this fluctuation problem by offering a hedging service: in this case, the underground online market covers the losses. Fortunately, a similar system wouldn’t work on a large criminal enterprise.