Bitcoin money laundering report ignores gambling’s history

A new report claims online gambling sites are prime conduits for laundering ill-gotten Bitcoin cryptocurrency proceeds, but its authors either chose to ignore or remain ignorant of gambling’s role in Bitcoin’s rise.

Last week saw the release of a report titled Bitcoin Laundering: An Analysis of Illicit Flows into Digital Currency Services. The report was issued by the Center on Sanctions and Illicit Finance (CSIF), an offshoot of the Foundation for Defense of Democracies (FDD), a Washington-based neoconservative think-tank.

The CSIF enlisted the help of cryptocurrency analytics provider Elliptic to study “illicit inflows” of Bitcoin to “conversion services,” basically any mechanism that allows users to convert Bitcoin into fiat currency.

The study examined the movement of Bitcoin derived from “clearly identified illicit activity,” which the study primarily defines as any Bitcoin moving off ‘darknet’ marketplaces, including the now-defunct Silk Road, as well as Bitcoin derived via fraud activity, ransomware and Ponzi schemes.