US government to ban virtual currency for data security

Federal government has decided to ban virtual currency Liberty Reserve for life and arrest its founder ‘Arthur Budovsky’ for 20 years imprisonment. On Friday last week, the US District Court for the Southern District of New York issued the said orders and also ordered a fine of $500,000 to be paid by Arthur within 90 days period.

In the year 2006, the said virtual currency was launched in Costa Rica allowing people all over the world to send and receive payments. Pretty soon, Liberty Reserve grew to become a financial hub for the criminal proceeds of Ponzi schemes, credit card trafficking, stolen identity information, and computer hacking.

In January this year, Budovsky pleaded guilty to one count of conspiring to commit money laundering through virtual currency Liberty Reserve.

According to a report published in New York Times, when the government decided to shut down the company, Liberty Reserve had more than 5.5 million user accounts and had processed more than 78 million financial transactions, with a total value of more than $8 billion. The largest group was U.S. users, with about 600,000 accounts, who generated between $1 billion and $1.8 billion of the transactions

Four other co-defendants, Vladimir Kats, Azzeddine El Amine, Mark Marmilev and Maxim Chukharev, were also found guilty in the investigation.

Now, the big news- As virtual currency is mostly being used by cyber criminals for fraudulent activities, the US District Court for the Southern District of New York has received a special case on banning virtual currency to curb money laundering and other fraudulent financial activities.

As the corporate world is finding it hard to deal with the menace of Ransomware, the filed case suggests banning of virtual currency transactions for the benefit of society.

Due to the presence of unregulated participants, lack of transparency, and Extraterritoriality and non-presence of specific formulations against the generation and usage of virtual currency a lot of crimes are taking place. If a ban is imposed on virtual currency, it will automatically put an end to issues related to data security like Ransomware, money laundering, drug trafficking, human trafficking, and other illegal activities.

The case will come for hearing at the end of this year and by then if it is backed by substantial evidence, then there is a high probability of all virtual currency like ‘Bitcoins’ banned by the federal nation.

More details are awaited!

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