I predict that all smart sources will eventually start using Bitcoin in the future because such decentralized payment systems can significantly reduce the risks associated with participation in black market steroid distribution.
Let's compare the use of Bitcoin with the most popular (centralized) payment system used by steroid sources - Western Union.
Sources who use Western Union
Suppose every year that a given domestic steroid source has 1,000 customers. Each customers places about 5 orders per year; each order averages $200. The source is collecting $1,000,000 per year.
How many different WU receivers per year do you suppose that source should have for maximum security?
50? -- That's 1 for every 20 customers. That's $20,000 per receiver. Is that good?
But how many sources do you know that have >50 receivers?
Do they even have 10-20? $50-100k / receiver. Not as good, huh?
Believe it or not, many only have only a few. Several hundred thousand / receiver. Pretty bad.
It's incredibly easy for law enforcement to use a cooperating, centralized company like WU to compile financial records of the crime especially as the number of receivers drops.
Sources who use Bitcoin
Take the same source with the same 1,000 customers, 5,000 orders, and $1,000,000 annual revenue.
How many different Bitcoin receiving addresses per year do you suppose that source should have for maximum security?
5,000+ - some sources may create one BTC address for every customer (1,000) but the safest method is to have at least one receiving address for EACH and EVERY transaction.
That would not be feasible and not cost-effective for a source to do with Western Union. In addition, collecting money via Western Union may well require a conspiracy of dozens of people to launder money. With Bitcoin, only ONE person is required to set up an unlimited number of receiving addresses.
Unlike the high cost of having multiple WU receivers, creating multiple Bitcoin receiving addresses is free.
Bitcoin can be dangerous for sources too
All of this notwithstanding, it should be noted that just because a source uses Bitcoin, it doesn't necessarily put them at any further beyond the reach of law enforcement. A source who doesn't understand the blockchain technology and is unfamiliar with necessary steps for anonymity could very well increase their chances of being caught by LE.
There is a public ledger of ALL Bitcoin transactions. So, if a source doesn't know how to clean coin and otherwise protect their anonymity, motivated LE investigators can easily compile financial records associated with the illicit activities and link them to a real name identity.
For example, consider the source that transparently send all their Bitcoin to their Coinbase or Circle wallet to cash out. Those money transfer agents comply with KYC and AML for a reason - if LE wants to know the identity of a Bitcoin wallet owner, such sources have made it very easy for LE to find them.
Bottom line is that sources who don't understand the blockchain technology should probably just stick with Western Union. Then again, those who are not motivated to understand it are probably the ones who fail to take other precautions in other areas as well...
Let's compare the use of Bitcoin with the most popular (centralized) payment system used by steroid sources - Western Union.
Sources who use Western Union
Suppose every year that a given domestic steroid source has 1,000 customers. Each customers places about 5 orders per year; each order averages $200. The source is collecting $1,000,000 per year.
How many different WU receivers per year do you suppose that source should have for maximum security?
50? -- That's 1 for every 20 customers. That's $20,000 per receiver. Is that good?
But how many sources do you know that have >50 receivers?
Do they even have 10-20? $50-100k / receiver. Not as good, huh?
Believe it or not, many only have only a few. Several hundred thousand / receiver. Pretty bad.
It's incredibly easy for law enforcement to use a cooperating, centralized company like WU to compile financial records of the crime especially as the number of receivers drops.
Sources who use Bitcoin
Take the same source with the same 1,000 customers, 5,000 orders, and $1,000,000 annual revenue.
How many different Bitcoin receiving addresses per year do you suppose that source should have for maximum security?
5,000+ - some sources may create one BTC address for every customer (1,000) but the safest method is to have at least one receiving address for EACH and EVERY transaction.
That would not be feasible and not cost-effective for a source to do with Western Union. In addition, collecting money via Western Union may well require a conspiracy of dozens of people to launder money. With Bitcoin, only ONE person is required to set up an unlimited number of receiving addresses.
Unlike the high cost of having multiple WU receivers, creating multiple Bitcoin receiving addresses is free.
Bitcoin can be dangerous for sources too
All of this notwithstanding, it should be noted that just because a source uses Bitcoin, it doesn't necessarily put them at any further beyond the reach of law enforcement. A source who doesn't understand the blockchain technology and is unfamiliar with necessary steps for anonymity could very well increase their chances of being caught by LE.
There is a public ledger of ALL Bitcoin transactions. So, if a source doesn't know how to clean coin and otherwise protect their anonymity, motivated LE investigators can easily compile financial records associated with the illicit activities and link them to a real name identity.
For example, consider the source that transparently send all their Bitcoin to their Coinbase or Circle wallet to cash out. Those money transfer agents comply with KYC and AML for a reason - if LE wants to know the identity of a Bitcoin wallet owner, such sources have made it very easy for LE to find them.
Bottom line is that sources who don't understand the blockchain technology should probably just stick with Western Union. Then again, those who are not motivated to understand it are probably the ones who fail to take other precautions in other areas as well...
