الأربعاء, أبريل 25, 2018
EnglishMohamed Jisri

Technology and Mischief – Virtual Currencies

By Mahmoud Jisri
Technology is an important factor of cultural and civil advancement/development. There is lot’s of evidence to prove that, but this also does not prevent some bad guys from trying to exploit it. Technology, at the end, is a set of tools, like many tools, can be used for good or bad. The following article attempts to shed some light on the dark side of technology and  increase knowledge and awareness.

We will start with digital currencies, such as Bitcoin and others, which is one of the most common current trends. Bitcoin has been the first virtual currency to get in the market accompanied by excited audience from all walks of life. Technicians who are trying new things and adventurers who are hoping for certain investments and pioneers with their own goals and agendas which may be known or not (such as inventor Satoshi who used a pseudonym and disappeared in an endless void). There was also a category dominated by some Platonic views – so to speak – that dreams of getting rid of the tyranny of banks and central governments and hope for a new financial system away from the control of the big brother’s laws and unfairly high fees . The largest category of all the mentioned above was the black market dealers who were mainly active on the Dark / Deep Web. In this market(s) there were lots of illegal products and services including drugs, prohibited weapons, sexual materials and services, forged documents, in addition to money laundering, gambling, hacking services and others. Such markets needed special programs to enter them, such as Tor browser. Markets operated under different names such as the Atlantis site, Black flag and the Farmers market, but the most famous of all sites/markets was the Silk road.

It was very necessary for all dealers on these sites to be completely anonymous and not to reveal their true identity to anyone , whether they are sellers or buyers. Doing any transaction was initially difficult and cash was handed directly or sent by mail , the exchange of goods was done in dark alleys and money transfer was done under fictitious names plus other complex exchange methods until the magic solution emerged with the launch of Bitcoin. The virtual coin guaranteed a degree of secrecy and the volume of trade increased by hundreds or even thousands of times. For example ,figures are listed in several reports, between 2013 and 2014, the FBI confiscated 280,000 bitcoins from these markets after complex prosecutions. (Which was less than $200 million dollars at that time but by today’s value the price is close to $ 3 trillions). This was the tip of the iceberg because, according to statistics of the Silk Road site, there was more than one million and two hundred thousand sale transactions from the beginning of 2011 to the middle of 2013 and total sales exceeded nine million and half bitcoins.
As a side note, speculators have begun to study the market and determine it’s rules, and we will return to them later .

In 2016-2017, the phenomenon of ransomware viruses has increased infiltrating many devices, from personal PCs to companies servers, hospitals and health centers. The main currency required for ransom was Bitcoin and with every major incident the price of the cryptocurrency increased due to the high demand. Speculators and experts continued to monitor and even began investing, buying and storing more and more of this virtual currency.

In 2010 during the course of this development of the first digital currency, one of the programmers who developed Bitcoin named Laszlo Hannich, did the first documented purchase using bitcoin and bought two pizzas for $10,000 coins (Which is equal to about $95 million dollars at the price of this article date of 26-2-2018).

This currency began with what is worth less than a cent and seven years after the unit price reached more than $20,000 (and then declined to half) in excess of all imaginations and fantasies.

I do not know what Laszlo feels these days when eating pizza, but back to the virtual currencies subject . The Venezuelan President Nicolas Maduro announced several days ago that his country was launching an official virtual currency called Petro Coin. Some other countries, such as Iran, are considering the idea too. If this becomes a trend it will certainly be a major source of headaches and problems to many international financial institutions – money has always been a cause of war.

In late 2017 and the beginning of 2018 many financial institutions entered to speculate on virtual coins officially and this entry contributed to many fluctuations and turmoils in market prices.

It is important to mention that there are now hundreds of virtual currencies with many names, which I think most will fail, but the successful ones will be linked to a product or a service, or supported by institutions or countries known for transparency and honesty and not linked to corruption, dictatorship and tyranny.

There are more details about the digital currency and it’s many obvious advantages which are listed in hundreds of published articles, but the goal of this article is to highlight the dark aspects of this technology to complete the image and show the pros and cons in the mind of the readers and I hope the above lines managed to convey the message. In the future I will try to list other modern technologies dark aspects and tools.

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‏‎Kamil Nasrawi‎‏

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