NSA Tracking Bitcoin Users? New Fears Add to Market Instability

March 21, 2018

With a still fragile recovery and many questions surrounding tax season, Bitcoin continues to receive bad news.

Recent information that the US National Security Agency (NSA) is tracking Bitcoin users around the world is triggering anxiety in the cryptocurrency market as industry players fear of fresh price free fall, reports the Express.

The latest leak emerged after whistleblower Edward Snowden revealed that the NSA used a single source to “help track down senders and receivers of Bitcoin”. The report said that although the NSA was targeting a wide range of cryptocurrencies, the spy agency is particularly focused on Bitcoins.

Part of the document reads:

“NSA agent is hoping to use the access for their mission of looking at organized crime and cyber targets that utilize online e-currency services to move and launder money. These illicit finance networks provide user access to international monetary systems while providing a high degree of anonymity.”

Snowden’s new leaked paper added that the NSA’s interest in blockchain technology, the decentralized ledger that underpins digital currencies, might have included gathering information using investor computers. The NSA could have also accessed information such as network ports, internet addresses, and timestamps.

The document said that the “Bitcoin targets” could trigger mass fears amongst investors that could send virtual currency prices to fall dramatically.

Bitcoin price up

Ironically, investors may have missed Snowden’s memo as Bitcoin jumped to $9,138 as of 6am UTC on Wednesday and was up 6.94% over the past 24 hours, data from CoinMarketCap showed.

A separate report by the Express credits a ‘productive’ meeting between central bank governors and finance meeting of G20 members in Argentina as the reason for Bitcoin’s price surge. Prior to the meeting, the cryptocurrency was hovering near the $8,500 and has rebounded more than $1,500 from its previous low.

Argentina central bank Governor Federico Sturzenegger described the discussion as a “very good meeting” and mostly dismissed fears of cryptocurrency risks.

He said:

 “The spirit of the discussion was very productive, and I agree that everybody left very pleased.”

Financial Stability Board chairman Mark Carney, who also serves the Bank of England (BoE) governor, sent a letter to G20 central bank governors and finance ministers stating that his office undertook a review of perceived threats posed by cryptocurrencies and did not found any.

He said in his letter:

“Their small size, and the fact that they are not substitutes for currency and with very limited use for real economy and financial transactions has meant the linkages to the rest of the financial system are limited.”

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