As I was saying in a column back on May 22, bitcoin and all the other phony cryptocurrencies need to be investigated. They are “bitcons” — confidence games that are going to eventually cheat anyone foolish enough to entrust their money to these scams. And they are dangerous because they allow rogue governments and crooks to live outside the rules and laws of society.
They are no more financial innovations — as their fans proclaim — than convicted mega-fraudster Bernie Madoff’s accounting.
I’ve called for federal scrutiny many times, but now it seems a unified Congress — yes, the Republicans and Democrats getting along for once — are joining the White House (when has that happened before?) to spur probes.
If you haven’t been following recent crypto-events you might think all the hubbub was caused by the announcement that Facebook was developing a cryptocurrency called Libra.
Facebook may not have many fans in Congress these days, but questions about Libra lit a fuse on what were seen as combustible regulatory problems regarding cryptocurrencies.
And if you’ve been playing around in this market, don’t be surprised if government agencies eventually come calling.
Here’s what I know.
About two years ago, according to a very reliable source, various US government agencies started looking into trading being done between Venezuela, North Korea, Somalia and Iran that were settled in crypto-dough.
All of these countries are in some way blacklisted from trading norms. The rogue nations access the so-called “dark Web” to settle a deal, that is, if a shipment of oil, say, can be smuggled in or out.
Cuba, for reasons only officials in that backward country could possibly understand, recently announced — yes, they made a public statement — that it would use cryptocurrencies to get around its trade sanctions.
How stupid is it to make an announcement like that! Hard to say, but it does help to put a spotlight on what’s going on while Congress and President Trump are attacking Facebook for wanting to get into the fake currency business.
But breaking through trade embargoes isn’t the only thing bitcoin and the others cryptocurrencies can do. They also help organizations that want to make trouble by moving money around the world for illicit purposes.
In other words, cryptocurrencies are great for funding terrorism and other criminal organizations looking to bypass rules banks have to follow to flag potential money-laundering activity.
That’s why Treasury Secretary Steve Mnuchin said this week that bitcoin and its sister fake currencies are a threat to national security.
His boss, the president, seems to be wholeheartedly behind him. “I am not a fan of bitcoin and other cryptocurrencies, which are not money and whose value is highly volatile and based on thin air,” Trump tweeted recently.
Trump gives a bad name to “thin air” in that quote. Bitcoin and the others are less than that. They are only worth something if people are confident they are worth something.
In other words, they are a con game and a dangerous one at that in the hands of the wrong people.
Here’s what I don’t understand.
Facebook’s Mark Zuckerberg got very lucky when he turned his college social Web site into one of the most valuable businesses on earth. He’s already in trouble with the feds. Why would he risk it all just to make more money with his Libra cryptocurrency gambit?
If there is ever another major terrorist attack on US soil and our government can prove it was aided by Facebook’s Libra, Zuckerberg and his shareholders could lose a bundle.
Facebook might even come under government control after all is said and done.
Credit: Source link
from WordPress https://ift.tt/2LodSUQ
Comments
Post a Comment
Thank