Bitcoin and other virtual currencies are attractive to criminals such as money-launderers and drug dealers, U. WASHINGTON — Warning that virtual currencies are attracting money-launderers and drug mythili raman bitcoin news, U.
Bitcoin and other peer-to-peer payment systems during the first-ever congressional hearing on the fast-growing Internet-based technology. Treasury, Justice and Homeland Security department officials told members of the Senate Committee on Homeland Security and Governmental Affairs on Monday that websites facilitating payments with Bitcoin should receive more scrutiny from federal financial regulators to ensure that the relative anonymity granted by virtual currencies isn’t exploited. Criminals are nearly always early adopters of new technologies and financial systems, and virtual currency is no exception,” Mythili Raman, the acting assistant attorney general for the Justice Department’s Criminal Division, said in written testimony. She said criminals are attracted to virtual currencies by the ability to complete transactions quickly, securely and “often with a perceived higher level of anonymity than that afforded by traditional financial services. So do a handful of conventional bricks-and-mortar stores.
Bitcoins are typically transferred from person to person. But some websites now let users exchange their Bitcoins for U. 6 billion worth of Bitcoins are believed to be in circulation worldwide, according to Bitstamp and other sites that track the price. Earlier this year, Bitcoin gained international notoriety as the currency of choice in the Silk Road black market, a hidden website that federal prosecutors said facilitated drug deals and other illegal transactions. Silk Road site and arrested its alleged operator. Virtual currencies, perhaps most notably Bitcoin, have captured the imagination of some, struck fear among others and confused the heck out of many of us,” said Sen.
Fundamental questions remain about what a virtual currency actually is, how it should be treated and what the future holds. Bitcoin proponents agreed that some government guidance is needed to combat criminal activity, but warned against moving too aggressively to regulate the budding payment system, which might only drive users abroad and put the currency out of reach of U. Virtual currencies like bitcoin have legitimate uses and should not be banned, federal law enforcement officials told a Senate panel Monday. While the officials warned that virtual currencies are popular with drug dealers and child pornographers, they said existing laws should be sufficient to stop criminal activity. Jennifer Shasky Calvery, the director of the Treasury Department’s Financial Crimes Enforcement Network, said the first reaction of law enforcement to new technologies or financial tools is often to worry about how criminals might abuse them.
But it’s also important that we step back and recognize that innovation is a very important part of our economy,” she testified before the Senate Homeland Security and Government Affairs Committee. Bitcoins exist only online, and owners of the currency are mostly anonymous. There is no central bank managing or backing bitcoins, and owners can trade the digital currency on a variety of exchanges or privately. The value of the bitcoin has fluctuated widely since they were introduced four years ago, but the currency surged in recent weeks on hopes that it could become an alternative to the dollar.