Vice President of Bitcoin Arrested for Laundering

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If money is the root of all evil, how about fake money? How about Bitcoins, this made-up currency that is trying to be the universal money of the internet? It seems even fake money tends to corrupt, if there is anything to the charges brought against Bitcoin Foundation Vice Chairman Charlie Shrem, 24, who was arrested yesterday outside of John F. Kennedy International Airport in New York shortly after he had a speech in Amsterdam.

What did the young man do? Misused his power. Bragging that he had his own plain and was worth over $6 million, it seems he knowingly contributed to the online underground bazaar Silk Road, which heavily used the new currency for laundering and selling drugs and so forth.

  

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Shrem has pled innocent, claiming, “The thing is, what the government can also do is try to arrest or take down companies that help push Bitcoin ahead. Our company [BitInstant, which has been closed down already] acted as  bridge between Bitcoin and dollars, has been taken down. And Bitcoin also has taken a hit. But we have contingency plans. I have a plane ticket ready to take me to Singapore. There’s another corporation already set up.”

Alas for young Shrem, it wasn’t to be! His passport has been taken away and he’s been carefully monitored in case he flees.

“Truly innovative business models don’t need to resort to old-fashioned law-breaking, and when Bitcoins, like any traditional currency, are laundered and uses to fuel criminal activity, law enforcement has no choice but to act,” said Manhattan U.S. Attorney Preet Bharara in a statement, as reported by Bloomberg. That thousands of people have suffered from bitcoin fraud is a testament to the problems behind Bitcoins.

Money in all its forms can be misused, and whether or not Bitcoin was a good idea in and of it itself, misusing it is never a good idea.

Image: The NY Daily News