The Wall Street Journal–and other defenders of the old guard–would have you believe that Cryptocurrency & Blockchain should and will fail because it is used by some to launder money and for other nefarious purposes.
The problem with this line of thinking is that our current financial system–the heavily centralized banking system–has thrived despite an absurdly large amount of money being laundering through it. The Danske Bank case is very illuminating.
The Banks That Helped Danske Bank Estonia Launder Russian Money
Forbes revealed that 234 Billion dollars had been laundered through four of the largest banks in the world, JP Morgan Chase, Bank of America, Deutsche Bank and Citi.
In the Danske case, the banks–intentional or not–missed plenty of red flags to catch the dirty Russian money. Perhaps the largest obstacle for a centralized entity to catch fraud is their own self-interest. The money laundered through the banks was still extremely profitable for them. The banks actually took turns serving as correspondent banks to make transfers for Danske Bank Estonia’s customers from Russia and Eastern Europe.
We all know that money is laundered through Crypto. The WSJ could not wait to point that out to us. However let’s zoom out a little and compare that to what happened in the Danske case.
$234 billion laundered through banks vs $88 million in crypto is three orders of magnitude worse!!!
The Large banks are trying to play the Danske case off as an outlier. We are not buying that. Always ask yourself who gains by accepting that narrative.
Disparity in Penalties
The investigations reported by the WSJ resulted in arrests and actionable information because crypto is traceable to a certain extent. But a series of investigations in the Danske Bank Estonia case resulted in little more than insignificant fines and regulatory slaps on the wrist for the big banks.
Shape Shift & Voorhees Response To the WSJ Attack:
The WSJ narrative was obvious and disingenuous: the banking system is reliable and trustworthy and crypto is not. Get outta here!
The response from ShapeShift was reasonable and quite measured despite the aggressive attack it received from WSJ.