According to the US Federal Reserve, Bitcoin serves as a mechanism for criminals to carry out criminal acts and illegal transactions.
Lael Brainard, senior board of the Federal Reserve Board of the United States (FED), said that a high percentage of transactions made with Bitcoin today would be related to criminal acts.
Brainard’s statements came during a panel of experts at a monetary policy event held in Germany, where the official shared some considerations about the current state of the digital currency ecosystem, and how they have promoted crime in different strata social.
During a speech delivered in honor member of the board of the European Central Bank Benoît Coeuré, the representative of the EDF, Lael Brainard, shared some considerations about the current state of the digital currency ecosystem and how these, in his opinion, have promoted The crime in society.
Also, Brainard cited a study conducted earlier this year in which it indicates that Bitcoin has a broad base of users who commit criminal acts, and commented:
“Only a third of the most popular exchanges handle KYC mechanisms at the time of making deposits or withdrawals. This is worrying, as several studies ensure that digital currencies support a significant amount of criminal acts. “
Bitcoin and criminals
One of the most controversial statements made by Brainard had to do with the volume of operations linked to crimes throughout the history of the digital currency, since the official said that 50% of Bitcoin transactions violated the provisions in some way legal valid.
In this regard, Brainard commented:
“One study estimated that more than a quarter of Bitcoin users, and approximately half of the transactions made on the network … are associated with illegal activities.”
However, several analysts say that the official handles misconceptions regarding the use of Bitcoin, since the fact that the network gives a certain margin of anonymity to financial operations does not mean that this goes against the laws in force. Other studies show that cash transactions continue to be the main vehicle for perpetuating illicit events.
Another study that discredits the official’s statements was the one carried out by MIT and Elliptic researchers in the middle of this year, which analyzed around 200,000 transactions and found that only 2% of these could be related to illegal activities.
Those responsible for the investigation indicated that these figures are due to the fact that despite the margin of anonymity granted by the digital currency, operations can be perfectly traceable by analyzing in detail the data hosted on the Blockchain network with different software.
The rise of stablecoins
Another important point highlighted by Brainard had to do with the rise of stablecoins, digital currencies whose value is equated with that of a fiat currency and in turn are backed by reserves in legal tender, which in the opinion of the official have grown in popularity and adoption in recent months because of initiatives like Facebook Pound.
In this regard, Brainard highlighted how digital payment systems have evolved greatly in countries such as China as well as the efforts of the Fed to develop an almost instantaneous transaction platform by 2023. However, he highlighted the interest in many people and organizations in which banks Centrals issue their own stablecoins, to which they indicated that there are still many challenges to be addressed in this area mainly associated with anti-money laundering policies and the financing of terrorist acts.