Cryptocurrencies: Guilty of charges? While digital money enthusiasts accuse cash of facilitating much of the criminal activity in the world, the facts show that cryptocurrencies are not as innocent as you'd like to think. Digital innovation can bring about positive changes but, as in everything, it has its dark side; and this is especially visible in the field of payments, where technological advances can become allies of transnational criminal activity. Cryptocurrencies were created to offer an alternative to the money used in transactions. In addition to the benefits invoked, cryptocurrencies were especially appreciated for their potential to reduce the risks of corruption and fraud. Unfortunately, as more and more people became fascinated with this new form of money, their traditional competence - cash - faced a reaction from governments and law enforcement, after being labeled a necessary accomplice to crime. While many are quick to blame cash, it should be borne in mind that despite being innovative, digital currencies may not be as innocent as their supporters would have us believe. In an article written by Jason Bloomberg, Forbes columnist, we learned that the eight most popular transactions with cryptocurrencies are mostly linked to illegal activities such as operations in the darknet, money laundering, file hijacking in exchange for rescue, theft and hacking, among others. In September 2017, Jamie Dimon, CEO of JP Morgan said that Bitcoin is only suitable for use by drug traffickers, murderers and people living in North Korea. It may have been a somewhat harsh statement for many, but the reality is that the lack of transparency of these digital currencies was soon identified as an asset for those who thrive on the illegal flow of goods and services. However, in the absence of regulations, we are not surprised that these virtual currencies have attracted people as traffickers of people and drug traffickers. A study conducted in 2017 by the University of Sydney showed that almost half of all transactions made with bitcoin (44%) - an estimated total of 36 million transactions per year, totaling a total value of 72 billion USD for be exact - they were associated with illegal activities. If the danger with cash is that, in the event of a theft, all of our belongings are lost, at least the damage is limited to the amount one carries in the wallet. In fact, contrary to what is believed, the theft of cryptocurrencies is a reality and has grown enormously to 927 million USD in the first nine months of 2018, while countries with little regulation to prevent money laundering washed bitcoins by value of USD 2.5 billion since 2009, writes CipherTrace Cryptocurrency Intelligence in its Report on Money Laundering Prevention with Cryptocurrency. Moreover, transactions with cryptocurrencies are "slow and expensive, with a tendency to congestion, and fail to adapt their scale to demand," says the Bank for International Settlements. In conclusion, the panorama of the payments is more like a painting by Pollock than by Monet: it is too simple to blame the cash for all the evils. Cash is a tool and, as such, behaves in the way that the end user behaves. This applies to all tools, including Bitcoin or cryptocurrencies. The question that must be asked today is not who is to blame, but what is the best way to minimize criminal activities. The axis of the debate should be a comparison of the extent of the damages of cash and cryptocurrencies because, in the end, one tool is tangible and the other, not so much. A good combination of regulation and adoption of payment diversity policies is necessary to contain the risk.
