Bitcoin Cash
Alt coins,  Bitcoin

While targeting Dark Web drug sales, White House snubs Craig Wright

An advisory notice singled out Bitcoin, Bitcoin Cash, Ethereum, and Monero, but utterly ignored the self-proclaimed Satoshi Nakamoto’s Bitcoin SV

Craig Wright has not been having a good summer.

First, his Bitcoin Satoshi Version (BSV) cryptocurrency was booted off the Binance and Kraken exchanges after he was accused of bullying people doubting his claim to be Bitcoin creator Satoshi Nakamoto.

Then the judge in a lawsuit brought by the family of his late business partner Dave Kleiman that could cost Wright $5 to $10 billion flat out called him a liar.

And now the White House snubbed his Bitcoin SV in favor of both Bitcoin (BTC) and Bitcoin Cash (BCH) in a notice warning that cryptocurrencies are being used to purchase fentanyl online.

Considered 50 times more powerful than heroin, fentanyl and similar compounds like carfentanil are blamed for what the White House called “an unparalleled epidemic of addiction and death, fueled by … fentanyl and other synthetic opioids” in the United States in an August 21 advisory notice.

Directed at banks and other financial institutions, the White House advisory warned that “convertible virtual currencies” (CVC) were among the ways that drug dealers are obtaining fentanyl.

“Individuals located in the United States search for fentanyl and identify potential websites that may provide the opportunity to purchase illicit drugs online,” the advisory said. “Foreign representatives will instruct the U.S.-based individual to send payments through CVC, such as bitcoin, bitcoin cash, ethereum, or monero.”

But for the self-proclaimed Nakamoto’s Bitcoin SV—which he calls the only cryptocurrency faithful to the original vision of Bitcoin’s creator—not a word. Apparently, it’s not big enough to be a threat.

To add insult to injury, at No. 10 on CoinMarketCap’s list of the top 10 cryptocurrencies by market capitalization, Monero (XMR) is one place below BSV (currently No. 9). Although to be fair, Monero is the best-known privacy coin, specifically designed to keep users anonymous. Bitcoin, Ethereum (ETH), and Bitcoin Cash are numbers one, two, and four on the CoinMarketCap list, respectively.

Wright and CEO Roger Ver clashed over the name Bitcoin Cash during a November 2018 fork. Wright’s preferred version lost the battle to convince exchanges to list it as BCH, and he settled on BSV.

Nine months later, Ver’s Bitcoin Cash has a market cap of nearly $5.5 billion and price of about $305, according to CoinMarketCap on August 22. Bitcoin SV is at $2.4 billion and sells for around $135.50.

Cryptocurrency not the target

While the “Advisory to Financial Institutions on Illicit Financial Schemes and Methods Related to the Trafficking of Fentanyl and Other Synthetic Opioids” does mention cryptocurrencies, it doesn’t really single them out. Instead they are mentioned in a fairly broad list of businesses and methods that can be used to launder money.

Of course, in the wake of Facebook’s Libra stablecoin announcement, President Donald Trump has been hostile to cryptocurrencies. On July 11, he tweeted

“I am not a fan of Bitcoin and other Cryptocurrencies, which are not money, and whose value is highly volatile and based on thin air. Unregulated Crypto Assets can facilitate unlawful behavior, including drug trade and other illegal activity.”

Actually, the advisories don’t seem to say anything new at all. Rather, they just go over well known facts about fentanyl, drug smuggling, and red flags financial institutions should look for when reporting suspicious transactions.

As well, the advisory goes out of its way to single out two of the Trump administration’s biggest targets, China and Mexico. The former is the main source of fentanyl and chemicals used to manufacture it, and the latter is “a transit and production point for the trafficking of many illicit drugs,” the advisory said.

Three examples are provided of smuggling transactions are provided. One involves Mexico’s Sinloa cartel. Another is about Jiang Zhang, a Chinese citizen who was the first person designated as a fentanyl smuggler under the U.S. “Kingpin Act.”

The third is the case of Matthew and Holly Roberts, who recently received long jail sentences for selling fentanyl on the darknet for cryptocurrency.

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Leo Jakobson, Modern Consensus editor-in-chief, is a New York-based journalist who has traveled the world writing about incentive travel. He has also covered consumer and employee engagement, small business, the East Coast side of the Internet boom and bust, and New York City crime, nightlife, and politics. Disclosure: Jakobson has put some 401k money into Grayscale Bitcoin Trust.