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Can Crypto Credit Cards Disrupt the Fight Against Financial Crime?

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It is commonly known that the world of finances has the biggest problem with the crime of all existing industries around the world. It has been so throughout history. While the financial world has evolved, so did the criminal activities, and they continue to be an issue. With the arrival of cryptocurrencies, many were hoping that financial crime might be disrupted. However, for now, at least, it appears that cryptos themselves cannot find a way to resolve issues such as international money laundering.

In fact, when it comes to money laundering, the crypto sector appears to be the weakest link, especially because of the nature of digital currencies. The anonymity that cryptos are being praised for means that anyone can get a payment from an unknown source from anywhere in the world. This method can then be used for financing drug trafficking, cyberattacks, terrorists, and more.

Until recently, it was not easy for bad actors to make use of cryptocurrencies obtained for illegal purposes. The number of merchants willing to accept the coins was low, and criminals were forced to find a way to exchange crypto into fiat currencies. However, this came with a set of issues, such as taking foreign exchange risks and then sending the money through wallets and exchanges to a banking system that would allow withdrawal. The banking account was the biggest obstacle here, as it was more difficult to get than opening a crypto wallet, which only requires an internet connection and a few minutes.

The situation has not changed that much, and even these days, criminals are still limited when it comes to spending money in its crypto form. However, large cash-outs by bad actors can be troubling for the crypto industry itself, as it can start a bearish trend that could, once again, crash the crypto market.

Visa’s new move might change things

All of this is something that might change soon, as Visa plans to start offering crypto-funded debit cards. Visa is, by no means, original when it comes to the idea. There were many others that attempted to bring crypto credit and debit cards in the past, but their efforts resulted in failure as they could not comply with regulations.

In Visa’s case, however, things appear to be different. The company’s recent cooperation with Coinbase seems to be directed at bringing a UK crypto card, which will allow users to spend their money directly from wallets. What’s more — they will be able to do so at any location where Visa cards are accepted, which at this point includes pretty much the entire world.

Not only that, but the card’s spending limit is expected to start at £10,000 per month, and grow to £20,000 for certain users.

Regulatory compliance remains an issue

Of course, all of this still requires answers to a few questions, such as — how did Coinbase go about satisfying KYC and AML regulations? There is no doubt that the regulatory environment regarding digital currencies is evolving — and has been for quite a while. Even some wallets managed to find a way to satisfy regulations and comply with the rules, which brought support from the regulators. They are still in the minority, of course, and criminals can still use most wallets without oversight, but the situation does appear to be changing for the better, in this regard.

Even so, with the majority of wallets still not being compliant with regulations, anyone who uses Coinbase could potentially get a payment from illegal sources with nothing to stop them, and with no punishment. But, Visa points out that Coinbase is regulated by the US authorities, and that the partnership between the two is subjected to enhanced scrutiny.

Coinbase itself fights against the issue by blocking accounts that are involved with suspicious activities. However, that would still require that the company notices suspicious activities in the first place. The nature of cryptocurrencies is the real issue here, as even if all exchanges and wallets implement KYC procedures, cryptos still remain mostly anonymous. The only real way of preventing illegal transactions would be to block payments that come from unregulated wallet accounts. However, this would go against everything cryptocurrencies stand for, not to mention that it would come at huge costs.

Additionally, even real, traditional banks have seen such issues, as there are many of them in countries with less strict regulations that might not be compliant with regulations. If the banks have found this issue too difficult and expensive to deal with, how can the crypto industry deal with it?

Crypto institutions will have to find a way to become compliant with regulations if they wish for Visa’s plan to become a reality. Otherwise, the last several decades of the fight against financial crime would simply be erased, and major consequences could come as a result.

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Disclaimer: This article should not be taken as, and is not intended to provide, investment advice. Global Coin Report and/or its affiliates, employees, writers, and subcontractors are cryptocurrency investors and from time to time may or may not have holdings in some of the coins or tokens they cover. Please conduct your own thorough research before investing in any cryptocurrency and read our full disclaimer.

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Altcoins

Aluna.Social is a Compelling Social Platform for Crypto Traders and Investors

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When one thinks about the social media landscape, the companies that first come to mind are most likely Facebook, Instagram, LinkedIn, and Snapchat.  These platforms are a great way to stay connected with friends, families, and colleagues, especially when geographic distance is a factor.  But, in addition to just chatting about life in general and sharing pictures, social media can be used to bridge the information gap that exists within the investment community.

Over the last decade, many trading offices have been established in large cities all over the world which allow solo traders and investors to pay a monthly fee in exchange for a workspace.  The real benefit to trading in these offices is to participate in the free flow of trading ideas and information.  Proprietary trading is one of the most challenging careers to be successful at and the exchange of ideas is almost required in order to succeed.  Traders at hedge funds and investment banks work in teams so why shouldn’t remote traders?

While these trading offices are a great way to help bridge the information gap, Aluna.Social may provide an even better way, especially as it relates to cryptocurrency trading.

Mission Statement

Aluna.Social, founded by Alvin Lee and Henrique Matias, is a multi-exchange social trading terminal for crypto traders and investors.  The goal of the platform is to help newcomers shorten their learning curve,…

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CoinFlip Scores Big with BRD Wallet Partnership

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As the crypto markets move closer to mass adoption, one of the keys for future success will revolve around attracting as many market participants as possible.  While many crypto users are extremely tech oriented, a lot of those on the sidelines are not.  The cause of waiting on the sidelines could be due to a variety of reasons such as fear of the unknown, lack of knowledge, age, or a combination of all of the above.  In order to entice new users to join the crypto revolution, crypto ATMs are rising up across the country.  Of those, the largest and most influential crypto ATM company by a significant margin is CoinFlip.

In early October, CoinFlip announced on its Twitter that it had officially partnered with BRD Wallet to re-introduce their crypto ATM map.  Now, BRD wallet users will be able to locate their nearest CoinFlip ATM and receive a 10% discount for both buys and sells.  BRD brand awareness is growing quickly within the crypto community thanks to its innovative and entrepreneurial spirit.  The team strongly believes in the value of financial freedom and independence, and want to empower people across the world by leveraging the possibilities that Bitcoin and other cryptocurrencies provide.

Cryptocurrencies are already making a huge difference around the world.  Citizens of Venezuela, a country devastated by rampant inflation, have been using several cryptocurrencies…

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Cryptocurrency Collateralized Debt Positions Are Growing in Popularity

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While Bitcoin (BTC) continues to hover around the magical 10,000 price level, altcoins continue to fight an uphill battle.  Simply put, hopes of a future bull run continue to diminish as Bitcoin maintains its dominance.  One school of thought is that a few altcoins will survive and flourish, but which ones are anyone’s guess.  That being said, it’s hard to go wrong picking against the top coins like Ethereum (ETH), Ripple (XRP), Litecoin (LTC), and EOS.  These projects have managed to find a foothold in the market and have a better chance than most of staying there.  While traders wait for their positions to increase in value, one opportunity that may be worth looking at is initiating a collateralized debt position.

What is a Cryptocurrency CDP?

In traditional terms, a CDP is essentially putting up collateral in order to receive a loan against the deposited amount.  There are several examples of this in our day to day lives.  Auto title loans from large companies like TitleMax are extremely popular with consumers.  Consumers are essentially able to use their car as collateral in exchange for a cash payment which can then be used for whatever needs the consumer has.  The consumer can continue using their car as long as debt payments are made.

The same concept applies to cryptocurrency CDPs.  Consumers are able to put up crypto tokens, such as…

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