BTC-E charged with laundering funds stolen from Mt. Gox
A grand jury in Northern California has indicted a Russian National, Alexander Vinnik , after tracing ~$4 billion worth of stolen Bitcoin to his addresses. His company BTC-e is also accused of operating an unlicensed money services business. He was arrested in Greece and will be extradited to face trial in the U.S.
This is one hell of a jurisdiction nightmare if I ever saw one. If this trial follows the path that it has set out so far, then the Libertarian take on the BTC currency will be all but dead. The remaining scaffolding will be public ledgers and secured transactions; privacy in industry will be all but dead.
Assuming this $4 billion in BTC will be put up for FBI auction, we could see huge new investment into the crypto-currency market, or a huge market crash. One way or another, this event will mark the beginning of the end for Wild West currency exchanges. The black markets are shuttering and being replaced with box stores. Apparently the Daimler ICO is a thing now.
What happens when big companies play with crypto-fire? We have tested this crypto-weapon against the dirtiest of the dirty black black markets. Cryptographically secure transactions, proof-of-work, and public ledgers are real and here to stay. They work best when all parties involved literally want to kill each other. What happens when this saw-toothed technology is unleashed into a Disney Land of Corporate BS?
For the last hundred years, corporations and investment have been carefully guided and fenced by regulators with a toolbox full of simple gadgets to thwack and knock and hammer any business operation that looks more like a weed than a garden flower. Regulators just use the smell test: if it smells rotten, then it needs to change or leave.
Now what happens when Distributed Autonomous Organizations start building social capital on the block chain? FileCoin for IPFS. NameCoin for DNS. All internet infrastructure can be refitted to work with literally zero operational staff. These are current technologies, sitting in the wing. Imagine if Facebook belonged to its users. Imagine if Twitter didn’t need to be profitable, just popular. These what-ifs will be the next generation of web companies. Headless. Amorphous. Unstoppable.
Investors seem pretty hyped. That’s what happens when there is blood in the water.
This post was originally published on medium.com