Bitcoin was developed to address flaws in existing fiat currencies. We want free-flowing, decentralised money that was independent of any government or central bank. And it occurred.
Because transactions are not supervised by a bank, crypto was meant to be safe, discrete, and secret. However, we've just learned that this isn't always the case.
Bitcoin is not as anonymous as it initially looked. In any case, every single transaction, from start to finish, is recorded on the blockchain.
Sure, a Bitcoin address is anonymous, but if the FBI, for example, issues a demand for your internet and email history, that anonymity is gone.
Let us illustrate with an example. You're a member of the Darkside hacking collective from Eastern Europe.
You and your friends have just taken control of the colonial pipeline, which, by the way, supplies 45 percent of the petroleum to the United States' east coast. It's quite significant.
As a result, you demand and obtain a ransom payment of 75 Bitcoin. This is shaping out to be quite a robbery. However, a month later,
just as you're deciding which color Lambo to acquire, the Justice Department was able to trace the transactions back to a wall housing these Bitcoin before seizing virtually all of them.
Bitcoin and other cryptocurrencies are now so clearly traceable that there is a whole underground industry dedicated to cryptocurrency laundering.
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