Digital Currencies

The Feds Are Contemplating a BitCoin Crackdown. Who Should They Police First?

bitcoin1 The Feds Are Contemplating a BitCoin Crackdown. Who Should They Police First?

Despite the vagaries of figuring out who should regulate a digital cryptocurrency that may or may not end up disrupting the global financial system, NERDr reports that the U.S. federal courts are ramping up their investigation into Bitcoin this week, which begs the questions: Who should they go after first and how? Between the Bitcoin Miners, Bitcoin Exchanges, Bitcoin Commerce, NERDr thinks Bitcoin Wallet Owners are the most unlikely target, despite their sheer number and possible criminal intent.

NERDr theorizes that existing U.S. anti-currency creation laws could be applied to Bitcoin Miners. Online Bitcoin Exchanges could be shut down using diplomatic connections from national banking authorities. Hard Bitcoin currency exchanges could be policed using “tactics for handling current mail and EBay fraud.” Whereas laws introduced to ban the use of Bitcoin for payments of good and services, could shut down Bitcoin commerce. Or, you know, just let the whole thing be:

More specifically, letting it run and using the entire Bitcoin network infrastructure as a honeypot sent from heaven.

Artificial Bitcoin Exchanges can be created to attach real identities with wallets, Bitcoin tracking mechanisms could be put in place at ISP level and backdoors placed in software.  All points discussed here could be realistically implemented and operational inside a month.

If the feds do opt for a crackdown, however, the post’s first commenter Mike notes, “If one cannot enforce law it is useless. They can’t stop Bitcoin and we are always be anonymous to them.” Nice “All your base are belong to us” callback, “Mike.”

Follow Nitasha Tiku on Twitter or via RSS. ntiku@observer.com

Comments

  1. Anonymous says:

    You have no chance to survive make your time,

    By which I mean, why don’t the feds just hack the server and sell a half million or so BTC?

  2. Ben says:

    What “Server” Ironman?  It’s a fully distributed currency – there is no central “Server”.  Even if there was, the encryption scheme used by bitcoin to secure the transactions is pretty much uncrackable – even for Uncle Sam.