by Simon Black, Sovereign Man:
Something pretty miraculous happened recently.
It appears that Jamie Dimon, CEO of JP Morgan Chase, went nearly TWO WEEKS without bashing Bitcoin.
This must be a record for Mr. Dimon, who seems to have barely been able to last an hour without calling out Bitcoin as a “fraud”, or a refuge for criminals and North Koreans.
Mr. Dimon finally broke his Zen-like meditative silence late last week, once again returning to the familiar assaults we’ve come to expect from the world’s most powerful banker.
On Thursday, Dimon downplayed the importance of Bitcoin during a teleconference with journalists, and then said he wouldn’t talk about cryptocurrency anymore.
One day later, Dimon was talking about cryptocurrency again, this time at the annual meeting of the Institute for International Finance.
Dimon’s rant was in top form, and he went back to his core material– governments won’t allow Bitcoin to exist, it’s only useful for criminals, etc.
He was later joined by his sidekick Larry Fink, Chairman and CEO of Blackrock (the largest investment management firm in the world with over $5.7 trillion under management).
Fink stated succinctly that Bitoin is “an index for how much demand for money laundering there is in the world.”
Now, these are clearly not dumb guys. Dimon and Fink are princes of Wall Street. They know finance.
But it’s pretty obvious they haven’t done their homework on cryptocurrency… since there’s really no objective evidence to support their assertions.
Dimon’s idea that Bitcoin is a “great product” for criminals is simply WRONG. Bitcoin is terrible for criminals.
Why? Easy. Bitcoin is not fully anonymous. Every single Bitcoin that has ever been mined… and every single transaction in Bitcoin that has ever been made… is recorded in the Blockchain.
In other words, it’s all public information.
That’s not to say that people’s names and addresses are recorded in the Blockchain; instead, a typical transaction record includes information about Bitcoin Wallet IDs, block numbers, etc.
[Visually, it looks something like this: https://blockchain.info/tree/292059716]
But for people with enough resources (i.e. governments), the transactions can be traced back to the source.
Here’s an easy example.
Let’s say Alvin the Arms Dealer signs up for a new account at Coinbase– the most popular exchange in the world.
Alvin links his Coinbase account to his bank account at, say, hmmm… JP Morgan Chase, and puts in an order to buy 100 Bitcoin.
The money transfers from JP Morgan to Coinbase, and Alvin’s Coinbase wallet is credited with 100 Bitcoin.
Alvin now sends those 100 Bitcoin to his friend Marvin the Money Launder.
Marvin sells the Bitcoin at another exchange, and deposits the US dollars into his own bank account.
EVERY SINGLE ONE OF THESE TRANSACTIONS has been posted to the blockchain.
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