CNBC just had a discussion of bitcoins
and a couple of similar digital currencies that I had never heard of. Concern was expressed that miscreants and
low-lives could use bitcoins to launder money.
I asked myself the
following question: If 99% of all money
laundering is in US dollars, which it is, isn’t it the security of the dollar
the issue? The dollar's vulnerability is putting too much of a burden on the
intermediaries to police transactions, which is driving up transaction costs. The
provenance of each bitcoin is contact within its code so every transaction is
recorded automatically. Why can't this
be done with digital dollars?
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