Fed Official: 50% of Bitcoin Transactions Involved With Illegal Activity

Michael LaVere
  • Lael Brainard, a member of the US Fed's board of governors, said bitcoin is still highly associated with illegal activity.
  • Brainard claimed close to half of all bitcoin transactions are made agaisnt the law. 

An official with the United States Federal Reserve’s board of governors said that roughly half of bitcoin transactions are associated with illegal activity. 

In a panel speech made Dec. 18 honoring Benoit Coeure, a member of the executive board of the European Central Bank, Fed official Lael Brainard said cryptocurrency is still strongly steeped in illicit behavior. She cited an academic study on bitcoin and its user base made earlier in the year and highlighted the role exchanges have played with slack KYC policies. 

According to Brainard, 

Only a third of the most popular exchanges require ID verification and proof of address to make a deposit or withdrawal. This is troubling, since a number of studies conclude that cryptocurrencies support a significant amount of illicit activity,

Brainard added that roughly half of all bitcoin transactions are related to illicit activity or conducted against the law, 

One study estimated that more than a quarter of bitcoin users and roughly half of bitcoin transactions, for example, are associated with illegal activity.

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