Do you know why governments dislike privacy cryptocurrencies? The immediate response is that some governments fear they will undermine their control over capital. Due to their private nature, many of these cryptocurrencies have the potential to be anonymous, which displeases government entities as they could aid criminals in conducting illicit activities and evading authorities.
Privacy cryptocurrencies are also subject to scrutiny by authorities compared to their more transparent counterparts like Bitcoin or Ethereum, as they operate on an open blockchain. Consequently, they are often seen as preferred currencies for illegal activities such as money laundering.
However, this fear of private cryptocurrencies by governments is unfounded, as everyone has the right to use money in a private manner to protect their assets or wealth from prying eyes. Governments often use these justifications as a means of control and even enact laws to restrict individuals from using money as they please.
The decentralized, private, and anonymous nature of these cryptocurrencies, free from government control and censorship, is frightening to authorities as they lack control over individuals who use these cryptocurrencies. It may sound absurd, but you will soon understand why.
In the paragraphs above, I mentioned that the government claims that private cryptocurrencies are mostly used for crime and money laundering, but is this true? Quite the contrary; the currency most used for committing crimes such as money laundering is fiat currency, the government's own currency. According to this article, only 1% of all corruption and money laundering transactions, out of a total of $3.2 trillion, are in cryptocurrencies.
Yes, only 1% of that amount is attributed to cryptocurrencies (both private and open), which is a negligible amount compared to fiat. So why does the government promote this idea? Well, as I mentioned above, they fear that people will gain control over their own money and use it as they wish. They are intimidated by the idea of losing control over their citizens and undoubtedly losing the tax revenue derived from money through tax payments. After all, the government produces nothing and lives off taxes.
Losing taxes to them is equivalent to losing power to accumulate money from taxpayers. Here, in Dr. Andrzej's post, it is also possible to see that no cryptocurrency, whether private or open, is predominantly used for money laundering. In fact, the cryptocurrency used to commit crimes on the internet is largely due to the government, yes, because they impose sanctions on countries, and these countries, in order to survive, resort to various tactics to overcome them.
So, the burning question remains, why does the government persist in promoting the idea that private cryptocurrencies are used for crime? I leave the answer to your judgment, but it is clear that things are not as they seem.
Remember:
CONTENT IS KING!
Find also this article here
Support this blog to incentivize my daily writings and to keep pace with all happenings in crypto: share, comment, tip ; after all, creators depend on sponsors donations to succeed.