The US just blacklisted more cryptocurrency addresses. The Treasury Department has blacklisted several digital currency addresses it says belong to three Chinese nationals accused of trafficking synthetic opioids in the US.
The Treasury's Office of Foreign Assets Control (OFAC) alleges that Xiaobing Yan, Fujing Zheng, and Guanghua Zheng have been running an international drug trafficking operation in the US. In turn, it has frozen these individuals' US-based assets. OFAC has also blacklisted a number of digital currency addresses associated with them, claiming that the accused drug traffickers laundered their proceeds "in part by using digital currencies such as Bitcoin."
These aren't the first digital currency addresses that OFAC has blacklisted. In November 2018, the office added Bitcoin addresses linked to two Iranian nationals to the Specially Designated Nationals list, prohibiting US citizens from dealing with them. The two men allegedly helped exchange millions of dollars worth of Bitcoin acquired via a ransomware scheme. At the time, the Wall Street Journal called the news "a signal of a new era in which illicit gains are transacted in code instead of cash." The latest action reinforces how serious US officials are about cracking down on the use of cryptocurrency for money laundering (See: "New money-laundering rules change everything for cryptocurrency exchanges).
We still have questions, though. What happens if blacklisted users simply get new addresses, which is an easy thing to do? And what will the consequences be if US entities transact with the blacklisted addresses? Perhaps publicizing digital currency addresses is more about sending a message to prospective money launderers: You are being watched.
The World Bank is still loving its blockchain-powered bonds. The World Bank's blockchain-based bond wasn't just a one-hit wonder. Nearly a year after it issued the two-year bond, the government-run global development bank has issued a second round, bringing the total raised to $108 million.
The World Bank issues between $50 billion and $60 billion in bonds each year to help fund sustainable development projects in emerging economies. Now, it has joined up with Commonwealth Bank of Australia (CBA), RBC Capital Markets, and TD Securities to manage the bond, which will be "created, allocated, transferred, and managed through its life-cycle" on a blockchain, according to a press release.
Last August, the World Bank teamed with CBA to raise around $80 million by issuing a two-year bond using a private version of Ethereum's blockchain software. The latest iteration of the platform will let investors trade the bonds on a secondary market, and those transactions will be recorded on the blockchain too. According to the World Bank, this is "the first bond whose issuance and trading are recorded using distributed ledger technologies."
Many blockchain experiments inside large organizations haven't gone anywhere. But a second round of blockchain bonds means the World Bank must think it is on to something. Sophie Gilder, head of blockchain and AI at CBA, certainly does: "CBA now has tangible evidence ... that blockchain technology can deliver a new level of efficiency, transparency, and risk management capability versus the existing market infrastructure," Gilder said in a statement.
Some crypto-criminals think jumping across blockchains covers their tracks. Big mistake. Remember WannaCry? The perpetrators behind the global ransomware attack in 2017 tried to launder their proceeds via ShapeShift, a service that lets users automatically convert one digital currency into another. But though many people seem to think ShapeShift and similar services enhance anonymity, new academic research suggests implies that this thinking is misguided. Read more here.
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Loose Change
Fill your pockets with these newsy tidbits.
- EU antitrust regulators are probing Libra, Facebook's digital currency project. (Bloomberg)
- Bakkt, the much-ballyhooed digital asset exchange created by the owner of the New York Stock Exchange, has been delayed for months. But it says it finally has the green light from regulators to launch in September. (The Block)
- Organizations that track terrorist financing are growing alarmed by the adoption of Bitcoin and other cryptocurrencies by Islamist terrorist organizations. (The New York Times)
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Vitalik Buterin has apparently been mostly absent (by design) from the development of six changes that will be part of Ethereum's next software update. (Decrypt)
+Ethereum's founder Vitalik Buterin says his creation can't succeed unless he takes a step back. (TR)
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Prominent Bitcoin developer Peter Wuille has unveiled a new coding language that's supposed to make it easier for programmers to write smart contracts for Bitcoin's blockchain. (CoinDesk)
