Sunday, January 27, 2019

Crypto Goes Beyond Speculation, the 8 Most Common Crypto Transaction Types

Finger pressing a block chain block with the text transaction, a bitcoin symbol and security sha256 algorithm hach. Composite between a hand photography. - Image

While speculative investments remain the most popular type of crypto transaction, it is far from being the only type.

The world of crypto transactions also includes legal purchases, ransomware, money laundering, Darknet transactions, and more.

Jason Bloomberg highlighted this in a recent article for Forbes where he listed the most common transaction types with crypto.

Darknet Transactions and Money Laundering

Speculation is the most common type of cryptocurrency transaction, where retail investors and other entities place bets on the price movement of digital assets in the hope of making a profit.

However, Bloomberg noted:

“If it weren’t for crypto, the Darknet would be a mere shadow of its current self – and Bitcoin remains the coin of the realm.”

He quoted the US Drug Enforcement Agency which said in a 2017 National Drug Threat Assessment Report that Bitcoin is the most common form of payment for online drug sales on the darknet.

Bloomberg also noted that cryptocurrency is being used for money laundering activities, suggesting that Bitcoin from criminal activities has flowed into countries with weak anti-money laundering laws (AML).

The practice is common in China where the movement of capital is restricted. Underground Banking Systems sell crypto to drug traffickers for the cash they earn from sales in Europe, Australia, and the US.

Evading Sanctions

Countries being sanctioned by foreign powers are also using crypto transactions to circumvent the restrictions being imposed on them.

North Korea is a prime example. The country desperately needs hard currency and cryptocurrencies provide them with an opportunity to obtain it.

Russian economist Vladislav Ginko has also talked about Russia using Bitcoin to diversify its financial reserves, as the country is forced to dump US treasury bonds due to US sanctions.

Ransomware and Theft

The Darknet allows the user to purchase ‘ransomware as a service,’ suggests cybersecurity service provider Mosaic451’s founder Michael Baker.

Black-hat coders are also available and take payment in crypto to develop customized ransomware.

Crypto related theft increased 3x in the first half of 2018 compared to 2017, according to CipherTrace.

It estimates that the total value of stolen crypto in 2018 will be more than $1 billion.

Another common type of crypto transaction is hacking crypto infrastructure.

The most recent case of this was reported by Coinbase when it noted deep reorganizations occurring in the Ethereum Classic blockchain including double spends.

The total value of these double spends was over $1.1 million.

Bloomberg also listed legal transactions as another common transaction type. This is the exchange of crypto for services and goods, just as you would use ‘real money.’

Crypto Goes Beyond Speculation, the 8 Most Common Crypto Transaction Types was originally found on Cryptocurrency News | Blockchain News | Bitcoin News | blokt.com.



A Blockchain is a growing list of records, called blocks, which are linked using cryptography. Cryptography is the practice and study of techniques for secure communication in the presence of third party adversaries. Cryptocurrency is a digital currency that uses encryption (cryptography) to regulate the generation of currency and verify the transfer of funds, independently of a central bank.
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