It does not mean Bitcoin is unstealable just because blockchain technology underlying the Bitcoin is unhackable.

Blockchain innovation and entrepreneurship has created a niche space within digital journalism for cryptocurrency information and news stories. Not to forget first ever post on this blog was review of ‘21 Cryptos Magazine’. Dark Web News regularly sends out email newsletters titled ‘Anonymity Newsletter’ to report events concerning deep web, dark net, bitcoin and cryptocurrencies. A recent Anonymity Newsletter email titled ‘Bitcoin is “Immoral” and “Stupid”’ sent on 11/Jul/2018 (which has got feeling of a public relationship exercise on behalf of Palm Beach Research Group) seems to have biased information. This post aims to debate some of the misinformation from the newsletter.

In context of the Bitcoin the newsletter claims: “In recent times, it's outpaced the run-up in stocks, bonds, gold, and silver.” [sic]

Time and again well-known economists and financial journalists have successfully argued that for a currency to be successful it needs be able to hold value and be stable. The problem with Bicoin is it does not have any intrinsic value backed by physical asset. Just because Bitcoin’s demand results in increase of its exchange rate in fiat currency does not mean it holds value. Jason Bloomberg’s Forbes article titled ‘What Is Bitcoin’s Elusive Intrinsic Value?’ discusses this challenge thoroughly.

The newsletter claims: “people will use digital currencies like Bitcoin to win back their freedom of choice.” [sic]

At times even a significant Bitcoin transaction can take weeks to settle reports Izabella Kaminska in a Financial Times article. Ethereum currently supports estimated 15 transactions per second whereas Visa Network is capable to support more than 24,000 transactions per second. The cryptographic currency infrastructure is not scalable (without compromising the security) to make cryptographic currency viable for day to day commercial transactions.

The newsletter claims: “Cryptocurrencies like Bitcoin meet a need that no other conventional asset can: freedom and virtual anonymity.” [sic]

Virtual anonymity in financial transaction is an advantage for terrorists, criminals and money launderers. It is proven the anonymity granted by cryptocurrency is abused by ISIS to fund international terrorism. There is no reason for a tax paying law abiding citizen to conduct anonymous transactions. In order to counter the threat of anonymity enshrined by cryptographic asset transactions the Basel Institute has started organising workshops for INTERPOL and EUROPOL financial investigators to train them about seizure and confiscation of cryptocurrencies.

The newsletter claims: “records are tamper-proof when they’re secured by a blockchain.” [sic]

Cryptocurrencies are often pitched as most secure assets (from cybersecurity perspective) due to the nature of cryptographically secure distributed ledger (that records the cryptocurrency transactions) being immune to hacking. The technologists forget the cryptocurrency frauds and theft don’t take place as a result of altering and hacking blockchain but as a result of hackers gaining access to the private key of a cryptocurrency wallet. Hackers have a number of strategies at their disposal, some similar to stealing internet banking credentials, to illegally access a cryptocurrency wallets. Summing up, it does not mean Bitcoin is unstealable just because the blockchain technology underlying the Bitcoin is unhackable.


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