Bitcoin and Defence: What is the correlation?

Bitcoin was designed to be a statistically independent asset, which is/was a benefit. However, bitcoin and equities have a strong correlation right now. It doesn’t take a technical analyst to spot the connection—obvious. This isn’t fantastic news for crypto investors because they own a lot of bitcoin and anticipate equities will crash hard shortly. 

Individuals, financial organizations, governments, and public sector entities all benefit from digital currencies because they provide greater access to financial goods, help financial empowerment, and reduce the danger of corruption and fraud. However, one of the most important hazards connected with digital currencies is criminals and terrorists’ capacity to exploit them.

What is blockchain?

A blockchain is a system for organizing and storing data according to a set of rules. Key is protected and a copy is saved on every node linked to the network, rather than being accounted for and stored on a central server’s database.

This revolutionary technology is being hailed as a potential revolution in the way the Internet works, with limitless applications. Blockchain is built on peer-to-peer sharing of decentralized datasets. As a result, it may be thought of as a large file that stores data in a logical, historical, secure, and immutable manner.

Is there a risk of crypto being used by terrorists?

While there is yet no evidence that any terrorist group has adopted digital currencies on an organizational level, examples where terrorists have utilized digital currencies suggest that concerns might arise in the future.

• To begin, digital currencies are produced via a process known as “mining,” which involves verifying each activity on a blockchain. While the blockchain records information about each transaction, this data is not connected to people, physical locations, or other identifiable information.
• A report from 2015  showed that bitcoin has been used in many illegal transactions and they also have links to several high-profile cases of criminals.
• Terrorists and criminals are likely to employ digital currencies for unlawful transactions because they provide comparable trust and reliability benefits as the conventional remittance system of financing.
• Third, Bitcoin guarantees financial security by acting as an impartial middleman, guaranteeing that coins are irreversible once spent, thanks to the blockchain. Alternatively, until the receiver returns coins to the originator, the blockchain network makes it difficult to remember a validated bitcoin transaction.
• Digital currencies, such as bitcoin, prohibit double-spending and ensure that money cannot be replicated inside the network in this context. If a transaction is attempted to be duplicated, the blockchain rejects it as defective or fraudulent.
• As a result, the digital currency may let both criminals and terrorists buy products and services on the Darknet, where they would otherwise be vulnerable to detection since they discovered that bitcoin is better than traditional trading options.

So, what are the ways to prevent bitcoin from being used by terrorists?

• Given that Bitamp bitcoin wallet employs blockchain technology to serve as a virtual record of all transactions on the network, it is not as private as it is generally thought. Because the blockchain is open to the public, anybody with a basic understanding of computers may track the digital footprints of anonymous traders.
• Better regulation is the second alternative. The US government suggested in 2017 that the Department of Homeland Security investigate the relationship between bitcoin and terrorism, claiming that the anonymity provided by digital currencies gives terrorists the seclusion they want.

So, do defense and bitcoin correlate?

Because of the nature of blockchain, it may be necessary to do more study in areas such as compatibility, internet infrastructure, and a detailed examination of its regulatory environment.

Conclusion

In the next few years, the defense scientific world is anticipated to look for new blockchain-based military applications, with cybersecurity, secure messaging, robust communications, logistical assistance, and the networking of the defense Internet of Things being the most likely candidates.