‘Bitcoin is for criminals’

Bitcoin is an opt-in system that is available to anyone. While it may be used by criminals, there is no evidence that bitcoin is any more popular with criminals than other forms of money. On the contrary, there are reports by blockchain intelligence platforms such as Elliptic and Glassnode — both of whom serve law enforcement agencies as clients — showing that bitcoin is less popular with criminals than fiat currencies. This is likely a result of the public nature of the Bitcoin transaction history, the blockchain. While addresses on the Bitcoin network are natively anonymous, if they are ever successfully linked to real identities all transactional privacy is lost, and it becomes trivial for law enforcement to trace the entire transaction history of a set of coins. In a paper published by the former Director of Intelligence at the CIA, Michael Morell, an official at the CFTC remarked that “[It] is easier for law enforcement to trace illicit activity using Bitcoin than it is to trace cross-border illegal activity using traditional banking transactions, and far easier than cash transactions.”