- Recent negative comments by new US Treasury Secretary Janet Yellen about Bitcoin and cryptocurrencies revolve around the alleged “illegal use”. However, data from a top blockchain analytics firm claims that only less than 1% of all cryptocurrency transactions are related to criminal activity. It is easy to see why the former Federal Reserve President’s assumptions regarding the digital asset class are so far from foundation.
Bitcoin is an asset and currency unlike anything that existed before it. Its futuristic technology and non-existence in the real world make many people uncomfortable and skeptical about cryptocurrencies.
Bitcoin is in a very different position compared to the first days
Bitcoin in the early days; Silk Road started out as a currency on the dark web market, where it was traded for drugs, explosives, weapons and other illegal products. Since then, Bitcoin has matured as a financial asset, ceased to be the cryptocurrency of choice on the dark web, and firms began tracing BTC transactions back to their origins.
Chainalysis, one of these firms, has been so effective in linking addresses to potential BTC holders and reviewing blockchain data that several branches of the United States government, including the IRS and the Department of Justice, have contracted with the company to provide more information about crypto assets and related information.
Less than 1 percent of cryptocurrency use in illegal activities
The firm recently announced some of the findings of an investigation into cryptocurrency crime. According to Chainalysis, the rate of criminal cryptocurrency transactions dropped to just 0.34%.
Bitcoin alone is approaching $ 10 trillion in value transferred. So while 0.34% is not something to be ignored, it proves that the first cryptocurrency was not the home of “illegal use” as stated by the US Treasury Secretary.
Yellen says Bitcoin should be “throttled” and is currently considering stricter regulations.