🚨Italian Bank Warning: Bitcoin P2P Services Become 'Crime as a Service'
Despite an increasing number of large institutions accepting Bitcoin, a recent report from the Bank of Italy has poured cold water on it. They referred to Bitcoin's peer-to-peer (P2P) services as 'crime as a service' (implying that criminal organizations implement criminal activities by providing services) and stated that these services could be used for money laundering.
The Bank of Italy stated in their 'Economic and Financial Interim Report' that these P2P services are becoming more popular in areas with lax regulation, becoming the new favorite of criminals. These platforms and trading networks bypass the familiar 'Know Your Customer' (KYC) and Anti-Money Laundering (AML) rules, making it easier for bad actors to hide the illegally obtained money.
This bank, which has a history of 131 years, further pointed out that decentralized finance (DeFi) systems pose greater challenges in combating money laundering. Since there are no intermediary institutions in this system, it is not as easy to regulate as traditional financial institutions. The anonymous nature of blockchain also facilitates identity concealment for criminals, a feature that is both loved and hated.
The report also mentioned some emerging technologies, such as Zero-Knowledge Proofs (ZKP), which may help reduce illegal activities while protecting user privacy. However, the Bank of Italy believes that these technologies cannot fully meet the needs of regulators in identifying suspicious activities.
🗣 Conclusion:
The Bank of Italy characterizes Bitcoin P2P services as 'crime as a service' and points out that they could be used for money laundering. This report realistically showcases some of the issues exposed by cryptocurrencies like Bitcoin during their application. However, we cannot deny the overall value of technologies like Bitcoin simply because they are misused by criminals at this stage.
Blockchain technologies like Bitcoin are characterized by decentralization, anonymity, and immutability, and these features in themselves are not problematic. Technologies like Zero-Knowledge Proofs (ZKP) aid regulatory bodies in combating illegal activities. Through these technologies, we can enjoy the conveniences of technology while maintaining financial security.
💬 What do you think about the Bank of Italy's report on Bitcoin P2P services potentially being used by criminals for money laundering? How should we balance privacy and regulation?
