US agencies see some benefits in virtual currencies

November 19, 2013

Federal officials told a U.S. Senate hearing on Monday that virtual currencies like bitcoin can offer benefits to the financial system, but also cautioned about its possible misuse for illicit activity. “The Department of Justice recognizes that many virtual currency systems offer legitimate financial services and have the potential to promote more efficient global commerce,” said Mythili Raman, acting assistant attorney general at the Department of Justice in her testimony before the Senate Homeland Security and Governmental Affairs Committee. “We have also seen, however, that certain aspects of virtual currencies appeal to criminals and present a host of new challenges to law enforcement,” Raman added in her written testimony before the committee, which is conducting an inquiry into virtual currencies. Law enforcement agencies suspect that virtual currencies are being used for money laundering and other illegal activities as they typically allow users to remain anonymous. Dealers of drugs and other illegal items on online marketplaces like the Silk Road and Black Market Reloaded are said to have taken cover behind the Tor anonymity service and anonymous bitcoin transactions. The Silk Road site was brought down in October by U.S. officials and its alleged owner and operator arrested. To read this article in full or to leave a comment, please click here

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