In the last month, the Venezuelan and Russian governments have discussed the use of digital currency to evade U.S. sanctions.
In particular, on December 3, 2017, Nicolas Maduro suggested the idea in a television speech. His plans are to create the Petro, which would be backed by Venezuela’s commodities (gold, oil, gas and diamond reserves) similar to the way gold has in the past supported the dollar.
Although the Russian government has expressed concern about the potential use of virtual currencies to commit crimes, more recently Russian President Vladimir Putin has indicated a willingness to explore the use of virtual currency to counteract U.S.. sanctions.
A recent book, Bitcoin and Cryptocurrency Technologies: A Comprehensive Introduction by Arvind Narayanan, Joseph Bonneau, Edward Felten, Andrew Miller & Steven Goldfeder, addresses fundamental questions about the pros and cons of using virtual currency. How does virtual currency operate? What makes it different? How secure is virtual currency? How anonymous are virtual currency users? What applications can we build using virtual currency (i.e., Bitcoin) as a platform? Can cryptocurrencies be regulated? If we were to design a new cryptocurrency today, what would we change? What might the future hold?
A recent article has mapped the design space for numerous proposed modifications, providing comparative analyses for alternative consensus mechanisms, currency allocation mechanisms, computational puzzles, and key management tools.
Why bother using crypto currencies to evade sanctions when the Russians already control Webmoney and other centralized virtual currencies which allow them to move unlimited funds, off the grid, avoiding Western financial detection systems? The LE community seems to be continually missing this major vector.