29.03.2024

US Fed Official Says 50% of Bitcoin Transactions Associated With Illegal Activity

Specifically selected for the panel, which formed part of the “Monetary Policy: The Challenges Ahead” event in Frankfurt, Germany, was illicit activity involving Bitcoin.

In a panel speech honoring Benoît Coeuré, a member of the executive board of the European Central Bank (ECB), Lael Brainard highlighted the perceived risks still posed by cryptocurrencies.

A member of the United States Federal Reserve’s board of governors appears to believe that one in four people who use Bitcoin are criminals.

Brainard: crypto exchange security troubling

According to Brainard, who cited an academic study from earlier this year, Bitcoin still contains a significant malicious user base.

“Only a third of the most popular exchanges require ID verification and proof of address to make a deposit or withdrawal. This is troubling, since a number of studies conclude that cryptocurrencies support a significant amount of illicit activity”, she told the audience.

Continuing, Brainard added that as much as 50% of all Bitcoin transactions were in some way conducted against the law:

“One study estimated that more than a quarter of bitcoin users and roughly half of bitcoin transactions, for example, are associated with illegal activity.”

Calculating the incalculable

The admonishing tone of the speech adds to the sea of misconceptions over Bitcoin’s real-world usage. As Cointelegraph reported, studies into transactions regularly produce opposing conclusions – others suggest that a lack of anonymity means genuine criminals still prefer cash.

Further difficulties lie in stating exactly how many people use Bitcoin, as a user can control an infinite number of addresses.

The speech comes ahead of sweeping new cryptocurrency regulations coming into force in the European Union. For his part, Coeuré has remained highly critical of Bitcoin in particular, previously describing it as the “evil spawn of the financial crisis.”

Bitcoin News Summary – June 17, 2019

Binance, the largest exchange by volume, is launching a new trading platform specifically targeting U.S. customers, in partnership with BAM Trading Services. The platform will be operated by BAM, while using Binance’s wallet and matching engine technologies. At the same time, Binance also altered its terms, to state that it is “unable to provide services to any U.S. person” due to regulations. Beginning September 12th, U.S. users will no longer be able to trade on Binance.com.

Coinbase is expanding crypto debit card service into Europe. Coinbase will now allow users in France, Germany, Ireland, Italy, the Netherlands and Spain to spend from their Coinbase account at any location which accepts Visa. This service has been available to United Kingdom users for some time.

The Financial Action Task Force, or “FAT-F”, is a collaboration between the USA, European Commission, China, and India. This body seeks to impose banking-style regulations on exchanges worldwide, requiring them to submit details of any client who trades in excess of $1,000. FATF also wants the identity of anyone receiving crypto. The group warned that countries which fail to comply would be blacklisted.

And finally, the Financial Supervisory Authority of Iceland has approved Reykjavik-based Monerium to provide fiat payment services on a blockchain and use it throughout the European Economic Area. It’s the first time electronic money has been approved for use over a blockchain.

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