An academic paper suggests that governments should attack public blockchains
An academic paper published in the Cyber Security Journal titled “Reconciling Anti-Counterfeiting Tools and Reconciling European Data Protection Standards” suggests that governments should target cryptocurrencies – particularly privacy protection chains – to fight money laundering.
The paper's author outlines methods for undermining trust in permissionless blockchains, including 51% attacks, spoofing and Sybil attacks – a form of malicious activity where a user creates multiple accounts to gain control of a network. The author:
“Users' trust in the network can be undermined by successful attacks against the blockchain community's ability to ensure the efficiency of the network's protocol.”
However, the paper argues that these methods should only be used as a “last resort” to fight money laundering after other policy initiatives such as registering wallet addresses, marking transactions, sanctions and other regulations have been exhausted.
Ultimately, any approach taken must attempt to balance the need to ensure compliance with existing laws, promote innovation, and protect individual user privacy, the author concludes.
Source: Unknown
Although the paper was published in 2021, the findings recently came into the spotlight after many users discussed that some of the same methods are currently being used to control the price of Monero (XMR) – the privacy-enhancing cryptocurrency named in the academic paper. .
Related: Kraken to End Monero Support in European Economic Area
Money Laundering: Just a Pretext for Strict Control?
In the year In 2022, United Nations officials stated that terrorist organizations are the most used for financing illegal activities – this statement was later confirmed by a report from the United States Treasury, which confirmed that criminal organizations prefer cryptocurrencies to cryptocurrencies.
Additionally, a May 2024 US Treasury report acknowledged that even when digital assets are used for illegal activities, they are being used to perpetuate legacy schemes that can be executed using cash or other asset classes.
Still, this hasn't stopped the US government from cracking down on crypto mixers and other privacy-enhancing tools. On September 26, 2024, a US judge ruled that the lawsuit against Tornado Cash co-founder Roman Storm could go forward.
Government action against these privacy-enhancing tools has sparked debate about the viability of these services, as many users question whether cryptocurrencies can survive under the current regulatory regime.
Magazine: Terrorism and the Israel-Gaza War Armed to Destroy Crypto.
