How to be anonymous: avoid bitcoin
As the first currency of the Internet, bitcoin has many attributes of its host network. Namely, it can be perfectly anonymous and perfectly transparent at the same time.
No, it is not necessary to have any record linking your name to what goes on in there – but good luck hiding anything.
Knowing enough about what someone does is just as good as knowing who they are, and often much more useful. In this world, what you do is much more important that what you’re called.
Hence, we know that nearly $150m in bitcoins was transferred on 22nd November. This was the largest transfer in the history of the currency (by value).
Moreover, it is most probable that this was an internal ‘housekeeping’ move by Bitstamp, the second-largest dollar bitcoin exchange. All this data, both the certain and the speculative kind, is entirely public and can be discovered by examining the block chain.
Do we know what internal housekeeping financial transactions were made by banks, hedge funds or Richard Branson on 22nd November? No. You can be very sure they’re very happy to keep it that way. Financial types cherish their secrecy.
But isn’t bitcoin supposed to help money launderers, terrorists, drug traffickers and other criminal types move their money without attracting attention?
On this evidence, bitcoin comes in second to a friendly chap with a pinstripe suit and a brass plate on the front door.”
Admittedly, anyone moving that much money through the banking system will trigger tripwires, but if you know where they are and who’s looking – which you will – it’s easier to look innocent.
With bitcoin, everyone ‘sees’ and you don’t know who’s looking, nor what they’re looking for.
Were he to run a dodgy operation requiring a major cash transfer, John Law would probably not do it in public. He would probably ask the existing criminal overlords how they’ve been doing it all these years.
Not that it seems that hard. By purest coincidence, $150m is almost the exact amount the US Government is thought to have handed over to terrorists in Afghanistan by funding the companies they control.
Admittedly, the details aren’t entirely clear and it would take digging through various levels of official secrecy and obfuscation to find out.
Perhaps if the US used bitcoin next time, it’d be easier to spot (and thus stamp out) this sort of support for terrorists. Just a thought.