Bitcoins are setting the standard for the crypto-currency market. Right now Bitcoins are the largest and probably the most known digital currency. It wouldn’t surprise me if some of the big companies start accepting bitcoins as payment in the future.
Bitcoins are fast since no bank or governing body is involved, they are cheap in terms of transaction since there is no credit or debit fee, nor charge back, they are considered secure since you are not using your credit card and they are inflationary and UNTRACEABLE.
In my opinion no-traceability comes with loads of threats that can outweigh the potential benefits of Bitcoins.
Bitcoins have a lot to offer, but they are also attracting criminals at an increasing rate. I have been hearing that a lot of companies, among them gambling ones, who process credit cards have experienced denial of service attacks. It seems to have become a standard of extortion for criminals against companies.
The way it works is that they normally first launch a small attack to let you know about the potential damage they can do to your business to make you realize that they are serious and that you are helpless. This is followed by a threat of a major attack in case you fail to pay the extortion. Most of the time the attack takes place when companies have limited resources available and close to weekends and holidays.
What makes it so easy for them? Well, the most difficult part when it comes to extortion is The Drop!!!!! Meaning how the criminal will collect the money, but this risk has been wonderfully eliminated by Bitcoins…the no-traceability, which makes the criminal Mr. Nobody.
I recently heard that it is also becoming popular for the collection of protection money from small shops and restaurants.
Additionally, more than a dozen people in the US have received death threats (see the picture below) and the FBI is now investigating the matter in more details. The letters usually include a note explaining that the police will never be able to identify the culprits.
Another incident was with the dating site Ashley Madison where millions of records leaked and the users are being blackmailed for Bitcoins.
Bitcoins are not controlled by law enforcement agencies. Since they don’t involve credit cards they are not obliged to follow PCI DSS either, which makes it fast, cheap, easy and of course untraceable. Nevertheless they have an impact on public life. I personally think an idea like this needs to be controlled for accountability and under the current system it will be very difficult to achieve. So, in this instance I vote for traceability even though it has both pros and cons.