Bitcoin has enjoyed a credibility boost in recent years, but there’s still a common misconception that it’s a money-laundering tool for criminals. That couldn’t be further from the truth. Fortunately, there’s more than enough well-qualified people out there willing to correct these myths.
Last week, it was the turn of Michael Morell, a 33-year veteran and former director of the CIA. Morell wrote, in his paper titled “An Analysis of Bitcoin’s Use in Illicit Finance”, that the technology behind Bitcoin is actually a “boon for surveillance” and “a powerful but underutilised forensic tool for governments to identify illicit activity and bring criminals to justice.”
The paper was published by the recently-formed Crypto Council for Innovation led by Coinbase, Square and Fidelity Assets. The report mentions that bitcoin’s attachment to crime is “significantly overstated” and that “blockchain analysis is a highly effective crime fighting and intelligence gathering tool.”
We recently spoke to Simone Maini CEO at Elliptic, a blockchain analytics firm tracking crypto-related financial crime, who echoed Morell’s sentiments. And the data supports them – as of 2019, only $829m worth of Bitcoin was spent on the dark web in a six-year period. That equates to a mere 0.5% of all Bitcoin transactions.
Morell concluded that “people are typically fearful of what they do not understand.” Ain’t that the truth – but luckily Bitcoin will still be here when they eventually come around.