Banning cryptocurrencies to fight crime is a ridiculous excuse

Many governments are trying to ban cryptocurrencies, with recent examples from China, India, Turkey, and Nigeria. The reason for this is simple: the decentralized nature of cryptocurrencies poses a threat to the old financial system, and since the technology itself is still in its infancy, it seems to attract news thieves. Even so, the ban on cryptocurrencies will not displease even the smallest hackers or scammers.

Hackers are still drawn to cryptocurrencies

Since the advent of cryptocurrencies, hackers have coveted this form of money. The perceived attraction of being anonymous when receiving payments has created an invincible aura for all cryptocurrencies. However, this is often misunderstood as no public blockchain in its current form is private or anonymous. Although transactions are pseudonymous on the blockchain, users will still need to convert to and from fiat currencies at some point. These steps often require verification of a person’s identity through official documents, negating the whole aspect of anonymity and privacy.

Connected: Report on Crypto Exchange Hacks 2011-2020

Although most hackers admit that cryptocurrencies lack both privacy and anonymity, the overall crime rate remains relatively high. Although the number of crypto-crime has dropped significantly in 2020, there are still many concerns, according to a report from security firm CipherTrace. For this reason, many governments want to ban cryptocurrencies in the hope that such measures will prevent hackers from causing harm.

However, this result seems rather unlikely. With tools like ransomware, malware, and other criminal activity, hackers don’t need much to change the way they receive payments. Cryptocurrencies offer aliases, but they’re not the only payment method for them.

These methods offer more privacy

Gift cards, for example, are a convenient and legal way to transfer value from one person to another. Most convenience stores sell gift cards for various services including Netflix, iTunes, PaySafeCard, etc. All gift cards are valid and do not require a name to receive or convert into cash online. In essence, these tokens are much more private and anonymous than cryptocurrencies. However, they are also more accessible, which makes them a more important issue for governments looking to deter hackers.

The same concept applies to prepaid cards for cellular providers. Since these cards do not require identity verification or check activation to purchase, they are essentially anonymous money. While a prepaid mobile card may not necessarily be available across borders, it is still a private way of transferring value from one person to another.

If governments are serious about discouraging hackers, they must also find a way to remove them from the existing financial system. Bank accounts and payment cards can still be hacked and misused all too easily in 2021. Medium attacks, etc. As long as there is a way for hackers to make money without being affected immediately, they will continue to explore the various options available to them.

Connected: Don’t blame cryptocurrency for ransomware

Relate the “criminal role” of crypto

While governments firmly believe that Bitcoin (BTC) and other cryptocurrencies are the number one cause of online crime, the reality is often different. According to a recent report from Chainalysis, only 0.34% of the combined trading volume of the crypto market in 2020 was associated with illegal activity. That’s a sharp drop from the 2% in 2019. If anything, this study by Chainalysis shows that less and less crime is focused on Bitcoin and other crypto assets.

If you dig a little deeper, it becomes clear that ransomware is still the number one solution for online criminals, and it is a very important threat and problem. As more people work from home due to COVID-19 restrictions, there are new opportunities for criminals looking to make money fast. That doesn’t automatically mean that cryptocurrencies will be phased out as most consumers don’t know how the industry works.

Connected: COVID-19: Decentralizing Standards As Workplaces Adjust To The New Normal

Conclusion: a ban on cryptocurrencies is not the solution

Any government trying to ban cryptocurrencies will fail for a variety of reasons. First, there is no way to stop people from using crypto assets because governments have no control over these networks and no central people or executives are pressuring them to shut down, rendering governments almost incapacitated. Even if regulators can make it difficult for service providers, these companies are not absolutely necessary for the maintenance of cryptocurrencies.

Additionally, the multitude of ways that hackers and scammers can use to make money shouldn’t be overlooked. If the goal is to prevent illegal activity, combating traditional financial abuse must be a top priority. Cryptocurrencies represent a far less criminal market than banking-related products and services, as well as gift cards and other forms of counterfeit money. Tackling cybercrime is a pressing issue as costs are spiraling out of control, but the focus shouldn’t be on cryptocurrencies.

Any attempt to take action against the cryptocurrency “because criminals use it” is wrong. If that is really the goal, there are different approaches to exploring instead of prohibiting something. Since one cannot use cryptocurrencies without a traditional financial system, it is not difficult to see what governments should be paying attention to. Unfortunately, none of them seem to admit that the system they maintain is responsible for most of today’s criminal activity.