Please provide an overview of the linkages between blockchain technology and corruption issues. Some trumpet blockchain technology as a potential anti-corruption tool, while others say that cryptocurrencies facilitate money laundering and other corrupt activities.
What are Bitcoin and blockchain?
Misuse of Bitcoin
Potential of blockchain for anti-corruption
Bitcoin and the blockchain technology which drives it has emerged as one of the most disruptive digital innovations in recent years.
These technologies are posited as being potential catalysts of transnational crime on one hand and as potential tools in the fight against corruption on the other. Neither perspective is true in the absolute sense. Bitcoin and other digital currencies can be used to expedite cross-border crime, tax evasion and corruption. However, Bitcoin transactions are meticulously recorded, and digital currencies are increasingly accepted as a legitimate investment.
Blockchain technology provides huge potential for more transparent, more accountable and efficient ways of storing government data and administering transactions. Yet, there are many challenges to overcome before the technology can be scaled. Legal frameworks need reform to regulate digital currency markets and to harness the full potential of blockchain technology.
Niklas Kossow and Victoria Dykes, Hertie School of Governance