According to a report published by the Australian Transaction Reports and Analysis Centre (Austrac), electronic, online and new payment methods were posing “an emerging terrorism financing risk.” Therefore, the country considers regulating these methods, Bitcoin included, under the strict anti-money laundering and counter-terrorism laws.
In the agency’s report it was stated that terrorist groups that were engaged in radicalization, recruitment and communication online were also very likely to use online payments as well as digital currencies. Therefore, considering the fact that the Bitcoin and its peers are seen as an emerging threat, they must be regulated under stricter laws.
However, Austrac failed to provide evidence that the Bitcoin is actually used for funding such terrorist groups, even though Brad Brown, acting manager for strategic intelligence and policy, has highlighted that certain incidents resulted from the “misuse of Bitcoin.” For examples he provided the Silk Road online black market as well as the Mt. Gox snafu.
Additionally, Austrac in the report proposes a revision of the existing anti-money laundering and counter-terrorism regulations in Australia. Moreover, it was recommended that the definition “e-currency” should include virtual currencies that aren’t backed by a physical asset such as the Bitcoin and the Ether.
Michael Keenan, Australia’s Justice Minister, created a bill whose goal is to amend the Anti-Money Laundering and Counter-Terrorism Finance Act in order to include regulations related to digital currencies.
Because of its anonymous and secure transactions, Bitcoin as well as all other digital currencies has become a favourite on the black market. The best example for that is the now closed Silk Road, a website that allowed buying and selling illegal drugs using cryptocurrencies.
Nevertheless, latest reports show that the Bitcoin market was now driven by legitimate payments, services and commerce, meaning the currency has evolved a lot since its release years ago.