Bitcoin Will Continue to Function Beyond the Reach of Government and Law

Bitcoin is a novel currency that lacks government backing and is instead defined by mathematical rules, thus putting it largely out of the reach of law enforcement. According to James Ball of the Guardian, Bitcoin’s potential was recently exposed by an investigation into Liberty Reserve out of Costa Rica. Liberty Reserve is accused of a $6 billion money laundering scheme as “a popular hub for fraudsters, hackers, and traffickers,” “intentionally created and structured to facilitate criminal activity.” Indictment against Liberty Reserve required action of 17 agencies, yet tracing traditional money exchanges is described as easy compared to the unregulated, essentially untraceable Bitcoin. Decentralized Bitcoin has the potential to take cash out of government control, a notion that both frightens and delights, depending upon who’s doing business. Of course, the other side of the coin is the lack of monitoring, insurance, regulation, and government protections that support confidence in currencies. No surprise that some Bitcoin exchanges want to sign up with regulators. – YaleGlobal