Criminals are early adopters, and in some ways they make excellent beta testers for new technology. They are always looking for a way around the system. Frankly, law enforcement officials really like it when payment is made in Bitcoin rather than fiat. I think it’s funny because as a former prosecutor I take this for granted. There is a real false sense of security when cables are used or traditional financial services are used. People think, “Oh, we know all about this. So we’re just going to issue a subpoena. The bank will give us those records and we’ll just go get the money. It is so far from the reality of the situation.
So, don’t you believe these ransomware attacks are a function of crypto?
I think you are asking if crypto is the cause of the ransomware, and it absolutely is not. I have pursued several of the Department of Justice’s biggest online money laundering schemes. In fiduciary systems, 99.9% of money laundering claims are successful. In fact, what really stands out about ransomware attacks is the Colonial Pipeline is a prime example. It is unprecedented for the Department of Justice to be able to recover the proceeds of international criminal activity so quickly. This timeframe is usually years, if ever.
When you think about the risks associated with crypto, what do you think is the leverage of the crypto system?
Just like in traditional financial services, of course there is leverage, I won’t deny that. But people can get a lot more influence with platforms overseas. So I think it’s in the interests of US regulators and consumers to foster responsible innovation here in this country. So, don’t say you can’t have any leverage, but let’s talk about what the limits are – what are the right rules of the road that we could agree on.
One of the only things that unites Congress lately is China, and I think American policymakers and lawmakers are starting to realize that China and other countries are moving forward, recognizing that the crypto and blockchain are a real priority, and one that we are behind, unlike in the internet, where Darpa and the US government helped create it.
What do you think of the memorization of crypto? When you see Elon Musk tweeting about Dogecoin, are you saying it’s great or terrible?
Somewhere in between. There’s something fundamental going on right now with the internet and culture, and I think crypto is at the epicenter. It’s easy to dismiss things like games or memes. I was a little guilty of this myself a few years ago. And, you know, I’ve been proven wrong several times. So one of the things I have tried to learn is to keep an open mind.
You’ve raised two billion dollars for this crypto fund amid this almost euphoria over the past two months around crypto and the future of crypto, NFTs, with the price of Bitcoin rising to over $ 60,000 . This week a lot of air has come out. Can you contextualize the fundraising and fundraising in this environment?