Major advances in technology in the last two decades have drastically changed the entire world, causing many long-established systems and devices to quickly modernize or risk becoming outdated. To name a few things that are now essentially obsolete: disposable cameras, physical maps, and public telephones. The next two decades will undoubtedly bring about a similar state of change, and among the systems that may very well be forced to evolve is one of the oldest and most fundamental in human history—currency. Before the Internet, currency had been exchanged in person or by mail for millennia. Now, nearly anyone can buy a product or service from someone else around the world. However, doing so generally costs the buyer or the seller (sometimes
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By offering almost complete anonymity by design, and due especially to the current lack of regulations, Bitcoin has become highly attractive to users, both law-abiding and criminal. “[Bitcoin] creates a unique payment system that can be used for illegal means such as money laundering, trading in illegal goods and services, financing terrorism, fraud, and tax evasion” (Levin, et al., 10). One well-known criminal activity that wrongfully took advantage of the benefits of Bitcoin was Silk Road, “the infamous online marketplace for illegal goods and services that federal authorities shut down in late 2013” (McGlynn, 795). A former Eagle Scout and citizen of California named Ross William Ulbricht, who operated under the alias ‘Dread Pirate Roberts’, ran the underground Silk Road Website, which accepted bitcoins exclusively as payment for the sale of drugs and other illicit goods. When the U.S. Department of Justice (DOJ) arrested Ulbricht and shut Silk Road down, they seized over 170,000 bitcoins, which were valued at over $70 million, as of November 15, 2013 (Levin, et al., 12). This and other cases show the government’s determination to regulate the use of Bitcoin and other digital currencies in an effort to combat their use in criminal …show more content…
Among these agencies are “the Department of Justice, which prosecutes crimes such as money laundering; the Securities and Exchange Commission, which regulates stock market brokers and investors; and the Federal Deposit Insurance Corporation, which insures bank deposits” (McGlynn, 799). With no laws regulating digital currency, and so many different agencies attempting to find ways to do so within their jurisdiction, the eventual result will likely be a number of different regulations. However, the first and most prominent course of action taken in the United States so far was that of the Department of Treasury Financial Crimes Enforcement Network (FinCEN), which issued a ruling on digital currencies in March 2014. “The guidance says that ordinary users of virtual currencies are not subject to regulation, just as ordinary users of cash are not. However, exchanges and miners who sell their bitcoins are defined as money services businesses, and both are subject to the same regulations as ordinary currency exchanges” (Turpin, 365). In other words, these businesses are subject to existing government regulations, which ultimately require them to register with FinCEN. This guidance is not yet a legal ruling on the issue—merely one department’s stance on regulating
By offering almost complete anonymity by design, and due especially to the current lack of regulations, Bitcoin has become highly attractive to users, both law-abiding and criminal. “[Bitcoin] creates a unique payment system that can be used for illegal means such as money laundering, trading in illegal goods and services, financing terrorism, fraud, and tax evasion” (Levin, et al., 10). One well-known criminal activity that wrongfully took advantage of the benefits of Bitcoin was Silk Road, “the infamous online marketplace for illegal goods and services that federal authorities shut down in late 2013” (McGlynn, 795). A former Eagle Scout and citizen of California named Ross William Ulbricht, who operated under the alias ‘Dread Pirate Roberts’, ran the underground Silk Road Website, which accepted bitcoins exclusively as payment for the sale of drugs and other illicit goods. When the U.S. Department of Justice (DOJ) arrested Ulbricht and shut Silk Road down, they seized over 170,000 bitcoins, which were valued at over $70 million, as of November 15, 2013 (Levin, et al., 12). This and other cases show the government’s determination to regulate the use of Bitcoin and other digital currencies in an effort to combat their use in criminal …show more content…
Among these agencies are “the Department of Justice, which prosecutes crimes such as money laundering; the Securities and Exchange Commission, which regulates stock market brokers and investors; and the Federal Deposit Insurance Corporation, which insures bank deposits” (McGlynn, 799). With no laws regulating digital currency, and so many different agencies attempting to find ways to do so within their jurisdiction, the eventual result will likely be a number of different regulations. However, the first and most prominent course of action taken in the United States so far was that of the Department of Treasury Financial Crimes Enforcement Network (FinCEN), which issued a ruling on digital currencies in March 2014. “The guidance says that ordinary users of virtual currencies are not subject to regulation, just as ordinary users of cash are not. However, exchanges and miners who sell their bitcoins are defined as money services businesses, and both are subject to the same regulations as ordinary currency exchanges” (Turpin, 365). In other words, these businesses are subject to existing government regulations, which ultimately require them to register with FinCEN. This guidance is not yet a legal ruling on the issue—merely one department’s stance on regulating