Bitcoin

Bitcoin Frequently Used in Money Laundering – Will Face Severe U.S. Regulations

Exhibiting volatile fluctuations in the crypto market, bitcoin, in addition to the crypto enthusiasts and investors, has been capturing the attention of the U.S. officials. This time, the treasury secretary, Steven Mnuchin, remarked bitcoin for its excessive use in illicit activities.

While in a press briefing, Steven unleashed criticism on bitcoin. He suggested that severe regulations will be devised to ensure that bitcoin doesn’t become “the equivalent of Swiss-numbered bank accounts”. In simple words, he meant to say that bitcoin’s secretive use in illicit activities was not tolerable at all.

In a recent interview, he even stated that cash was laundered less than the world’s largest cryptocurrency by market cap.

Continuing at the briefing, Mnuchin elaborated that illicit transactions of billions of dollars were done with the help of bitcoin and other cryptocurrencies. Moreover, he mentioned that the Swiss bank accounts posed risks to the financial system of the U.S. He explained that Swiss banks offered great extents of privacy and secrecy to their clients. While doing so, the banks allowed several potential bad actors to avoid taxation and carry out their illegal activities under the belt, avoiding governments. Later, he linked bitcoin with the accounts and concluded that like Swiss accounts, allowed bitcoin an easy way out for the bad actors.

On the other hand, in his interview, the secretary clarified that the situation with cash was totally different than the situation with bitcoin. The host argued that cash or fiat is laundered every now and then but still didn’t see as harsh treatment as bitcoin. To this, Mnuchin denied by stating that the U.S had the strongest anti-money laundering (AML) system to daily deal with the bad actors in the U.S. dollar.

READ ALSO: Bitcoin Failed as Payment Method – Do Banks Really Need to be Afraid of it?

This is not the first time that a U.S official has shown their dislike towards bitcoin. Recently, the president of the United States, Donald Trump bashed bitcoin and other cryptos while stating that they weren’t actual money. Further expressing his thoughts that these crypto-assets weren’t backed by any commodity, he stated that bitcoin and altcoins were highly volatile. Dependent on the speculation, unregulated bitcoin and other cryptocurrencies welcomed illegal activities such as drug trade, etc. In this regard, his exact words read:

I am not a fan of Bitcoin and other Cryptocurrencies, which are not money, and whose value is highly volatile and based on thin air. Unregulated Crypto Assets can facilitate unlawful behavior, including drug trade and other illegal activity….

Bitcoin has been playing with the sentiments of investors for the past few days. While going through several falls and rise, the largest decentralized cryptocurrency by market cap has been subjected to severe criticism from several U.S officials due to bitcoin price volatility. However, there are some people who have managed to retain their bullish thoughts for bitcoin.

Among many U.S officials, U.S. representative Patrick McHenry revealed his take on bitcoin’s indestructible nature. While openly showing his belief for bitcoin, McHenry said:

I think there’s no capacity to kill Bitcoin. Even the Chinese, with their firewall and their extreme intervention in their society could not kill Bitcoin. The essence of Bitcoin is what Libra and Facebook, and corporates are trying to mimic.

Volatility and illegal practices associated with bitcoin continue to be problematic for the majority, therefore, allowing people to lash out cryptocurrencies. While due volatility and uncertainty associated with bitcoin according to the media hype, illegal use of the digital asset is expected to keep damaging the crypto space. However, no matter how corrosive response bitcoin experiences, the survival of bitcoin is not dependent on sentiments.

READ ALSO: Bitcoin Ban: Crypto India Reacts to Draper’s ‘Shame on India’ Remark

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Fatir Malik

Electrical engineer by profession, turned into blockchain developer. Fatir contributes regularly with his insights about latest developments in fintech sector. Contact the editor at editor.opinions@blockpublisher.com

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