Bitcoin

By: Justin Jung

Bitcoin:

The Rising Problem

What is going on right now?

So what?

• Bitcoin has become the choice for criminals around the world to buy illicit goods.
• FBI shut down the Silk Road, a major illicit goods merchant.
• There are literally millions of merchants that could be opening up

The best solution

Background Information

• US Treasury program standing for Financial Crimes Enforcement Network. On March 18, 2013 FinCEN established guidelines for virtual currencies.
• US Commodity Futures Trading Commission looks after financial underlying contracts. It has not established guidelines, but they say they could if they need them.
• The US Securities and Exchange Commission currently has NO official regulations, but its Office of Investor Education and Advocacy has published a paper warning people about schemes to steal their bitcoins.

People involved

Introduction

• Best solution: to add a mandatory catalog to the bitcoin purchasing step.
• This catalog will make merchants put what they are selling and make it so that the CUSTOMER selects the item.
• Most people are completely unaware of the fact that bitcoin is being used for malicious purposes.
• Will be tested by bitcoin executives who will receive the product. If it is the actual thing, they will mark it as good. If it isn’t, they will mark it as bad, and the FBI will shut it down.

• Uses cryptography to keep you anonymous.
• Gives you a very complex internet address, with numbers and letters, like this: 1DTAXPKS1Sz7a5hL2Skp8bykwGaEL5JyrZ.
• If you own bitcoins, you get a very, very complex string of numbers and letters, called your private address.
• With these addresses, bitcoin takes the merchant’s address and sends bitcoins from your private address through your internet address to the merchant.

Timeline

Step 1

Step 2

Step 3

Test the interface, and work out any bugs

Confront bitcoin executives, and ask them to approve the plan

Go to computer programmers, and ask them to create the interface

• People needed to implements this.
• Includes:
• Bitcoin executives, because they need to approve the plan.
• Store merchants, because they need to agree, or bitcoin value will decrease.
• Computer programmers, because they have to create the interface to actually make it work.

In 2009, the people or person called Satoshi Nakamoto released one of the first decentralized, anonymous payment, P2P (Peer to Peer), digital currency. It’s called Bitcoin. At first, bitcoin was a chance at a no fraud, no hassle, and non-stealable currency. Then, it went bad. Now, criminals use bitcoin to make anonymous payments for illicit goods on the Deep Web. Currently, there are a few illegal bitcoin markets selling drugs, people, and even fake papers. How can we stop the rising threat of corrupt bitcoin usage?

Step 4

Release as a bitcoin purchasing step.

In Conclusion

In conclusion, the best solution is to create a catalog, because it is inexpensive, not time consuming, very effective, and has no major effect on normal people. This catalog will hopefully lower bitcoin use to buy illicit goods. We can tell if this is successful if the amount of buying decreases. I hope that this is what it will accomplish, and that it helps keep illicit goods off the list of things people buy with bitcoin.