Does Bitcoin Have An Image Problem?
As the well-known saying goes, “You never get a second chance to make a good first impression.”
Despite it’s growing success over the last few years, bitcoin just can’t seem to shake reference to it’s dark past. Will bitcoin ever be just “bitcoin?”
How does it affect the (bitcoin) industry?
Bitcoin started making the headlines in late 2013, around the time that Silk Road – the infamous darknet market – was shut down by the FBI. Not long afterwards, Japanese bitcoin exchange, Mt. Gox, filed for bankruptcy and announced that 850,000 bitcoins (an estimated value of $450 million at the time) belonging to both customers and the company were missing. In fact, most of the stories to come out at this time focused on the use of bitcoin for criminal activity. Fast forward a few years and a number of notable successes for bitcoin… and not much has changed. Martin Tiller points out:
[Bitcoin news stories] fall in to one of four categories most of the time. There are those that tell of bitcoin’s role in some criminal enterprise, those that detail the latest business seeking to use the idea behind the blockchain for some non-bitcoin related purpose, and those that report the latest attempts of governments and monetary authorities to come to terms with and regulate the digital currency. Finally, there are a few stories that actually report on bitcoin’s increasing acceptance and influence.
Bitcoin recently made the news after claims were made that it was used for terrorist financing. A number of news outlets were quick to cover this story, reinforcing to the public that bitcoin is solely used for criminal activity. However, if we take a minute and remember that terrorism has been around much longer that bitcoin, we have to ask ourselves the question: what did terrorists use before bitcoin to fund their attacks? Answer: regular fiat money, of course! And this not only applies to terrorism – bitcoin is commonly associated with other illicit goods and services which all have been around longer than the digital currency.
It fell under the radar, but the EU law enforcement agency, Europol, actually released a report stating that there was no evidence to link bitcoin and terrorism – prepaid cards were the main source of financing for the terrorist attacks in Paris in November, but it would appear that the news outlets forgot to follow up on this story.
Much of what people read about bitcoin in the news is selective and/or misreported. For those unfamiliar with the industry, these stories only strengthen their preconceived opinion of bitcoin (drugs, terrorism, scams) and if this does not change, then the industry is at risk of slow consumer adoption, enforced regulations and the continuation of a “walking on eggshells” relationship with banks.
How does it affect CoinCorner?
At CoinCorner, we’ve experienced first hand what a bit of bad press can do to both our business and the industry. In 2014, following the collapse of Mt. Gox and the aftermath of negative news stories, we lost our UK banking partner as a result of the pressure put on banks not to accept bitcoin businesses. Banks are now slowly opening their doors to bitcoin businesses, but we’ve still not found another UK banking partner. In order for CoinCorner to continue to grow and succeed, bitcoin needs to be able to flourish.
Let’s cut bitcoin some slack! I think we’ve all done things in the past that we’d rather forget.
Disclaimer: The views and opinions expressed here represent those of the contributor, not necessarily those of CoinCorner.
Will bitcoin ever shake it’s bad reputation? Let us know your thoughts in the comments below…