Bitcoin Payment System
Bitcoin Payment System- According to a 2015 Europol report, bitcoin was used in over 40% of high profile investigations involving payments between criminals in the European Union.
To understand why this is, we must examine the anonymity that such a service offers.
Bitcoins are created through a process of ‘mining’ to verify each transaction on the blockchain. While information regarding each transaction is recorded on the blockchain, it is not directly linked to names, physical addresses, or other identifying information. This makes it anonymous to a certain degree, and complicates efforts by law enforcement agencies to identify individual transactions and link them to users.
Terrorists and criminals use bitcoin for illicit transitions, as it provides financial security. The blockchain acts as an impartial intermediary, ensuring that coins are irrevocable once spent. The network hampers any attempt made to recall a verified bitcoin transaction unless the recipient actually sends the coins back to the sender. By doing so, it prevents double spending and ensures that money cannot be duplicated within the network. Moreover, a network of ‘miners’ works to ensure each bitcoin transaction is unique and legitimate. If an attempt at duplication is made, the block-chain rejects the transaction as forged and faulty. Therefore, it benefits both criminals and terrorists purchasing goods and services on the Darknet, who would otherwise be at risk of being scammed by rival criminal organisations on the other side of the network.
In August 2015, for example, authorities in the United States convicted Mohamed Elshinawy, from Maryland, for providing material support of a financial nature to Islamic State. According to official records, Elshinawy had received approximately $8,700 through various financial channels including Western Union and PayPal accounts, from individuals with known connections to Islamic State, for the purpose of funding terrorist operations. Elshinawy, who had received the money between March and June 2015 from various overseas companies located in the United Kingdom and Bangladesh, intended to use the funds to launch terrorist attacks in the US. According to the US Department of Justice, Elshinawy and other members of Islamic State had used various means of secret communications to conceal their criminal association and activities from law enforcement.
Since 2014, there have been reports of high-ranking jihadist fighters in Raqqa, a former Islamic State stronghold in Syria, making use of money transfer offices for small or domestic purchases, and using advanced modern technology in the form of bitcoin for long-distance international transactions. In January 2015 it was reported that Islamic State, in what was then an unprecedented move, had started raising funds through bitcoin. A fundraiser identified as Abu-Mustafa argued that a massive crackdown by US law enforcement on mainstream financial platforms, coupled with a lack of financial and other resources available to Islamic State supporters in the United States and South America, meant that the Darknet should be used to raise funds in bitcoins. Abu-Mustafa raised about five bitcoins, valued at approximately $1,000 (at the time) before the account was closed.
The post Is Bitcoin A Credible Payment System For Terrorists? appeared first on Statii News.
source http://news.statii.co.uk/is-bitcoin-a-credible-payment-system-for-terrorists/
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