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It is a little strange that the Bitcoin,
we don't know who the creator is.
You don't think it was Al Gore, do you?
[LAUGHTER] Hey, this is Annie for WTBD,
where we take a single topic that people are excited,
curious about, or in some cases, getting super rich off of,
and ask a simple question-- what's the big deal?
Bitcoin has been in the news a lot recently,
so yesterday, I underwent one of the most bone-chilling journeys
I've ever taken as a journalist-- actually watching
CSPAN-3.
What happened yesterday was the very first official Senate
hearing on the peer-to-peer money,
bringing many clues as a virtual currency
and anonymity in general.
But the topic is definitely not new to the agencies whose
jobs are to protect the financial system
and enforce law.
Take the Silk Road bust in October
where the FBI shut down the large illegal market where
drugs, guns, weird ***, and many a jar of pregnant urine
were bought and sold using Bitcoin.
It's gained a reputation as the currency of outlaws,
but is Bitcoin itself illegal?
So long as they comply with applicable anti-money
laundering and money transmission laws
and regulations, are not inherently illegal.
No.
It's not illegal.
It's just anonymous, which in and of itself
presents a variety of issues.
Without transaction records, law enforcement
has to resort to infiltration, which basically means
making an account, and waiting till someone screws up.
But not only is that time-consuming--
We're not catching the truly sophisticated,
the most high risk organized criminal offenders.
But the black markets we've come to associate with Bitcoin
are just one piece of the puzzle,
because as was pointed out, the best way to do crime
is still good old fashioned cash bribes.
Serious criminals looking to hide their tracks
are more likely to choose a centralized virtual currency
run by an intermediary willing to lie to regulators for a fee.
And in spite of the criminal context,
the tone was mostly friendly at the hearing,
with a lot of open-mindedness about the potential of Bitcoin
to improve financial assets and foster innovation.
Among those who want to bring Bitcoin to the mainstream,
like Patrick Murck of the Bitcoin Foundation,
we saw willingness to play ball.
If you give us clear rules, we will follow them,
and we will build jobs.
But what is playing ball actually mean here?
It means following the same rules
that govern every other financial institution.
Register within FinCEN.
It's an online form, and it's free.
Put in place AML protections, controls in place
to harden yourself to the likelihood
that bad actors will take advantage of your system.
And maintain records and provide certain reports to FinCEN.
Those regulations will diminish the anonymity
that made Bitcoin what it is-- a billion dollar industry.
But if price is any indicator, it
seems like the Bitcoin community at large
welcomes some legitimacy.
In the hours after the hearing, the price
surged up again to over $800, and has since
leveled off at about $700 at the time of this writing.
While the value saw boost though from the mainstream recognition
on Monday, the conversation over anonymity is likely to rage on.
Do you think Bitcoin users are entitled to anonymity?
Let me know you think on Twitter or Facebook
at @AnnieGaus, where you can also send me
story ideas or feedback, as well.
Thanks for watching.