If You Want Financial Secrecy, Bitcoin & Other Cryptocurrencies Can’t Deliver It
— August 30, 2018
By Ingo Walter
But those who are looking to beef up the value of financial secrecy through cryptowallets and distributed-ledger transactions are likely to be sorely disappointed. If that’s the end game, don’t bother with bitcoin, or its counterparts.
Financial secrecy can be profoundly beneficial by assuring confidentiality for individuals, businesses, banks, governments and many other — some even consider secrecy a “human right.” It plays a vital role as a catalyst in creating economic and social benefits that wouldn’t be possible without the existence of proprietary information. But it also makes possible the dark underbelly of the system — tax evasion, the narcotics plague, human trafficking, organized crime, sanctions-busting and money-laundering, terrorism, corruption, espionage, suborning elections, and an array of other nefarious activities. Classic tools include cash transactions and money laundering through secrecy havens.
Now, along come cryptocurrencies like bitcoin offering total transparency inside their blockchain platforms along with anonymity between cryptowallets and their real owners.
Is crypto a threat or an opportunity for those looking for financial secrecy? The answer matters for the future of global finance, and it doesn’t look good for those in need of confidentiality.
Read the full MarketWatch article.
Ingo Walter is a Professor Emeritus of Finance