Bitcoin No Longer Desirable Option for Criminals, Says CoinCorner CEO

Published at: July 26, 2019

The sentencing of the CEO of the now-defunct darknet marketplace Silk Road shows that Bitcoin usage by criminals is in the past, according to Danny Scott, CEO of Isle of Man-based Bitcoin (BTC) exchange CoinCorner.

Gary Davis was sentenced to 6.5 years in prison for helping manage the now-defunct darknet marketplace Silk Road. The 31-year-old Irish man, who was extradited to the United States, had served as Silk Road forum moderator between May and June 2013 before working as a site administrator between June 2013 and Oct. 2, 2013, according to a report by Irish independent radio station Newstalk on July 26.

According to U.S. officials, Silk Road operated over 1.5 million transactions with a total value of more than $213 million between January 2011 and October 2013, the report notes. Recently, Cointelegraph reported on the arrest of a Silk Road dealer who allegedly used cryptocurrency to launder over $19 million of profits from selling illegal drugs on Silk Road.

Criminals no longer find Bitcoin desirable

Danny Scott, CEO of Isle of Man-based Bitcoin (BTC) exchange CoinCorner, says that Davis’s sentencing shows that Bitcoin usage by criminals is in the past. In a press release to Cointelegraph, Scott stated that Bitcoin is “no longer desirable option for criminals,” citing CoinCorner’s previous Bitcoin-related investigations alongside with British crime units, which indicate a decline in Bitcoin criminal activity.

He also cited findings by U.S.-based blockchain intelligence firm Chainalysis, which reported earlier this year that illicit transactions comprised less than 1% of all Bitcoin activity in 2018, down from 7% in 2012.

In the press release, CoinCorner CEO considered Bitcion’s anonymity as a common myth, arguing that Bitcoin is actually pseudonymous, which means that all transactions are recorded on blockchain forever. As such, Bitcoin is a “poor choice of currency for criminals,” Scott concluded.

On July 1, Bloomberg reported on another Chainalysis research that suggested that the amount of Bitcoin spent on illegal transactions this year could hit a record high of $1 billion despite the dwindling share of criminal activity. According to the report, the total value of Bitcoin spent on illicit activities as of July is estimated to comprise $515 million.

Tags
Bitcoin
United States
Crimes
Silk Road
Darknet
Related Posts
Digital intelligence must overcome challenges to solving crypto crimes
While the value of cryptocurrencies has varied wildly in the last year, this has not diminished crypto’s attractiveness to criminals. Many of them are moving their illegal activities underground and outside the view of law enforcement. Because of the public nature of most blockchains, however, this rapid movement shouldn’t be a major concern to law enforcement agencies. With the right tools and training, following the proceeds of crypto-enabled crime is actually not as difficult as it may seem. However, intelligence agencies must have a cryptocurrency investigation plan that includes the right tools to lawfully collect digital evidence and the properly …
Technology / Aug. 20, 2021
US Citizen Indicted for Narcotics Distribution in Exchange for Bitcoin
A United States citizen has been charged with heroin and methamphetamine distribution in exchange for Bitcoin (BTC). According to a Jan. 3 press release published by the U.S. Attorney’s Office for the Eastern District of New York, Joanna De Alba allegedly promoted and sold illegal narcotics on a dark web marketplace dubbed the “Wall Street Market,” between June 2018 and May 2019. The official release notes: “Defendant Joanna De Alba, a U.S. citizen, will be arraigned this afternoon in federal court in Brooklyn on an indictment charging her with conspiring to distribute and possess with intent to distribute heroin and …
Bitcoin / Jan. 3, 2020
Alleged Silk Road Drug Dealer Arrested in the United States
United States Attorney for the Southern District of New York Geoffrey S. Berman announced the arrest of alleged dark web drug dealer Hugh Brian Haney in a press release published on July 18. Per the release, Haney has been charged with money laundering. He allegedly used cryptocurrency to launder more than $19 million of profits earned selling illegal drugs on the now-defunct darknet market Silk Road. Berman commented to the development: “Today’s arrest should be a warning to dealers peddling their drugs on the dark web that they cannot remain anonymous forever, especially when attempting to legitimize their illicit proceeds.” …
Bitcoin / July 20, 2019
Are the BZx Flash Loan Attacks Signaling the End of DeFi?
Earlier this week, the decentralized lending protocol bZx was exploited in back-to-back “flash loan” attacks. While the two exploits were distinct, the end results remained the same. In total, $954,000 was gleaned from the platform. But what exactly happened? Was it an exploit, a simple case of arbitrage or a malicious attack? And where does decentralized finance go from here? It hasn’t been a good PR week for the DeFi sector. For some, the movement promising an alternative to the legacy financial system is starting to look like a failed experiment. For others, the attacks amounted to little more than …
Bitcoin / Feb. 22, 2020
McAfee to Lead 2020 Presidential Campaign ‘in Exile’ After Alleged IRS Indictment
United States entrepreneur and serial cryptocurrency advocate John McAfee has fled the country to conduct his 2020 presidential campaign, he said in a video statement Jan. 22. McAfee claims he has been indicted by U.S. tax authorities and plans to run his campaign from a boat in international waters. The controversial crypto community figure, who plans to run for president of the U.S. next year, said he had learned that a grand jury had been convened against him by the Internal Revenue Service (IRS). While he said he did not know the exact nature of the allegations against him, McAfee …
Bitcoin / Jan. 23, 2019