An official at the Bank of America (BoA) believes that cryptocurrencies impede the efforts of law enforcement to catch criminals.
Cathy Bessant, the chief technical officer (CTO) at the multinational financial institution, believes current transparency in banking allows authorities to police transactions in a way not possible with digital currency.
Is Cryptocurrency Actually Easier to Use Than Cash to Evade Authorities?
Cathy Bessant spoke to CNBC’s ‘Squawk Box‘ earlier today. On the morning segment, the official cited a lack of transparency as one of cryptocurrency’s more troubling qualities. She went on to compare the traditional banking system with the financial innovation:
“As a payment system, I think it’s troubling, because the foundation of the banking system is on the transparency between the sender and the receiver, and cryptocurrency is designed to be nothing of the sort. In fact [it’s] designed to be not transparent.”
Based on her stance towards digital currency, Bessant must also has a massive problem with cold hard cash too. Physical notes have enabled thousands of crimes in the past. Of course, the difference between cash and cryptos, like Bitcoin, is that cash doesn’t have an open blockchain that has a record of every transaction that can be used to follow the movement of funds involved in criminal acts. For this reason, she must loathe cash, although I’m sure she uses it daily.
Hypocrisy aside, Bessant continued her attacks on cryptocurrency stating that it impeded law enforcement’s ability to catch ‘bad guys’:
“The way we sort of quote-unquote catch bad guys is by being transparent in the financial moment of money. Cryptos is the antithesis of that.”
Despite Bessant’s cautionary words, those using the services provided by the BoA are still free to invest in Bitcoin. They are, however, excluded from using a BoA credit card to make such purchases. Although some may perceive this as an attack on cryptocurrency, the policy seems a rational stance for a institution providing lending services given the risks involved with such speculative investments at present. Bessant explained how it was in-keeping with their policy on stocks and shares:
“Just like we don’t allow stocks to be purchased on our credit cards, we’re not going to allow cryptos or other currencies to be purchased on our credit cards.”
This latest outcry from a voice associated with the banking industry is hardly the first time that cryptocurrency has been attacked based on its supposed association with criminality.
The likes of Jamie Dimon and Vasant Prabhu previously said that it was only useful to avoid paying taxes or to facilitate drug deals. Despite this, evidence suggests that less than one percent of Bitcoin is currently being used for illegal purposes. Funnily enough, people said that the internet would only be useful to criminals back in the 1990s. Look how wrong they were.
Featured image from Shutterstock.