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Banks Are Better Suited For Terrorist Financing Than Cryptocurrencies

Banks Are Better Suited For Terrorist Financing Than Cryptocurrencies

Cryptocurrencies like Bitcoin are not as good at financing terrorism as banks. This is what the Financial Information Unit, a department of the Financial Supervisory Authority in South Korea, has now discovered. This confirms previous investigations by both the US Congress and Europol.

The anonymity of Bitcoin is for many an important pro argument. At the same time it serves as the basis for criticism like: “crypto currencies support terrorists!”. This conclusion is understandable at first, terrorists want to remain as anonymous as possible. Since May of this year, crypto exchanges in the EU have been required to retain the identity of users and their identification with the wallets for up to ten years.

As the South Korean Financial Information Unit points out, while banks have better systems to contain money laundering and terrorist financing, their vulnerability is increased significantly due to the larger size of the banking sector and the natural characteristics of their products and services. The investigation also found that the difficulties in tracking Bitcoin transactions could be exploited by criminals to act anonymously. In fact, this is not the case. For example, terrorists continue to use traditional banking services.

The FIU has come to the same conclusion as before the US Congress and Europol. In September of this year, a US Congress group announced that cash remains the most popular form of terrorist payment. Cash simply still promises the highest anonymity.