How does bitcoin digital currency work?
Bitcoin digital currency differs from traditional currencies and has become an increasingly prominent method of payment in the world of internet commerce.
Traditional currencies are regulated by governments, but Bitcoin digital currency is only regulated by its value to users and its expected value in the future. This allows Bitcoin digital currency users to feel somewhat secure since no government can arbitrarily reduce the value of the currency. Bitcoin digital currency receives further praise from users as transactions with Bitcoin digital currency can be made with more anonymity than traditional currencies afford.
Why do some legislators want to make Bitcoin digital currency illegal?
Some legislators have commented that the anonymity that Bitcoin digital currency users enjoy has been abused. According to these legislators, online services such as ‘Silk Road’ require the use of Bitcoin digital currency for all online transactions. To legislators, this requirement by ‘Silk Road’ and similar services provides a truly anonymous marketplace in which contraband can be transferred.
Though ‘Silk Road’ warns users not to abuse the anonymous marketplace for the transfer of truly dangerous materials, some in government fear that ‘Silk Road’ and related sites have used Bitcoin digital currency technology for nefarious purposes. These legislators claim that Bitcoin digital currency has enabled ‘Silk Road’ to establish an online mega marketplace where drug traffickers cannot be easily traced or stopped. Legislators fear that unless Bitcoin digital currency is banned, drug trafficking will become as easy as shopping at internet retail sites, like Amazon.com.
What efforts have been taken to curb the usage of Bitcoin digital currency?
Having read about sites like ‘Silk Road’ and the potential abuse posed by Bitcoin digital currency, Democratic Senators Charles Schumer and Joe Manchin wrote the US Attorney General, warning him about anonymous drug trafficking over the internet. Though no legislative efforts have yet been undertaken to restrict or ban the usage of Bitcoin digital currency, the United States will perhaps soon see efforts made to stop illegal drug trafficking through placing impediments on the usage of Bitcoin digital currency.
Proponents of Bitcoin digital currency argue, however, that drug trafficking could be stopped without having to place limitations or restrictions on the usage of Bitcoins. Instead, they argue, law enforcement officials could use available technology to track down individuals abusing Bitcoin digital currency, and prosecute them accordingly. Bitcoin proponents concede that while identities of all Bitcoin parties are anonymous, there are many ways in which law enforcement would be able to target offenders through analysis and research of individual habits on the internet.