SYDNEY (Reuters) – An Australian law enforcement agency is investigating bitcoin’s role in organised crime, an official said, just as politicians and financial regulators embrace the digital currency as a legitimate part of modern business.
The investigation into bitcoin’s crime links by one authority as others embrace it highlights the crossroads governments have reached as they struggle to regulate the five-year-old “cryptocurrency”, a method of making anonymous payments which has surged in popularity around the world.
Australian Crime Commission Executive Director Judy Lind revealed for the first time that investigators will monitor “misuse of virtual currencies to facilitate criminal activity” at a national and international level, under an operation named Project Longstrike.
“We know that virtual currencies including bitcoin are used as payment methods to facilitate illicit trade on the darknet,” Lind told Reuters in a statement, referring to a hidden part of the Internet where information can be shared anonymously and without revealing the location of its source.
“Organised crime groups continue to make use of darknets to harbour trading in illicit commodities, including child exploitation material, illicit drugs and firearms, stolen credit card and identity data, and hacking techniques.”
Project Longstrike is just the latest example of Australia’s determination to crack down on bitcoin-enabled crime. Last month, Australia said it extradited to the United States the alleged primary moderator of Silk Road, a website where people bought illegal drugs like heroin using bitcoins.