Digital currency does have a dark side a lot of use , it facilitates the anonymous nature of the people with the aim of either breaking the law or not ( cybercrime ) - perform transactions using digital currency . Indeed , one thing that is unfortunate because it really is not all users of digital currency transactions in violation of the law , but the events that occurred in Liberty Reserve is also making the ' good ' also affected ( accounts and funds that they have participated in Liberty Reserve frozen )
And what about BitCoin ? Previously let us first learn the basic concepts that distinguish BitCoin with other digital currencies . To make it easier we take the example of Paypal and Liberty Reserve .
PayPal - a lot of misconceptions about this one . Paypal is operated by PayPal , Inc. which has a center -based operation or operations in the territory of the United Amerka . Paypal is not a digital currency , PayPal is a payment processor that mediates transactions between buyers and sellers , between the sender and receiver money money . PayPal does not publish its own digital currency and fixed using conventional currencies ( USD , Euro etc. ) in the transaction process .
Easy language , Paypal is a service that offers the convenience of a global transaction using credit cards to help e - commerce merchants who are not able to ' rent ' or build its own secure payment system . Paypal also offers security to the buyer to be able to transact safely without worry of credit card numbers seen by others .
Liberty Reserve - Run by Liberty Reserve , Inc. which has a center -based operation or operations in Costa Rica ( anyone know where this country ? ) .
It's not a secret , that Liberty Reserve came after a pioneer of digital currency e -gold stumble legal issues in the case of money laundry in the United States , walaupin not proven e - Gold still not allowed to operate in the United States are forced to move to the South Africa -based operationnya . Taking the opportunity to e - Gold fall of abandoned consumer , Liberty Reserve also seemed to be a savior appeared and then become the largest digital currency that is used throughout the world - including Malaysia .
Many people think , Liberty Reserve is a lifesaver that facilitates many people - especially those who do not have credit cards and have access to Paypal in order to remain able to transact online . Though one is not known by most users are - by their actual use Liberty Reserve tantamount to enrich the owner of the company and also circle the official exchange Liberty Reserve maker .
Liberty Reserve and similar digital currency currency issuing digital versions of their own ( the issuer ) which is often referred to by the acronym LR ( such as LR 5 which is equivalent to 5 USD ) , in siniah then the problem is actually happening .
Let us explain , Money is a product that is different from other products . Money can not be printed in quantity own wishes and should be set in the world of law and finance concepts . Such MYR Malaysian currency issued by the Bank of Malaysia - it certainly can not then suddenly Malaysian Bank scored and took off in the amount of EUR wishes to market - this will cause financial problems of economic problems such as inflation , devaluation and others . So in other words , MONEY IS A PRODUCT THAT limited.
What is Liberty Reserve? As already mentioned , Liberty Reserve issued by a company that is for profit . Liberty Reserve currency products that hit the market in fact none other than the digit digit diciptakam by a system ( software , etc. ) that can be produced by EASY according to market demand .
So , in fact Liberty Reserve , Inc. has access to ' print ' their own currency in an amount according to his wishes ( 1 trillion LR ? , Or berapun number ) , depending on market demand ( buyers ) without worrying with all sorts of polemics financial problems such as inflation , devaluation and others . As long as there are willing to buy LR , during which the LR can be produced digitally .
At first , the concept is often heralded heralded - backed by GOLD - which means that if Liberty Reserve has a reserve of gold bars worth $ 10,000 , then he CAN ONLY AND SHOULD produce 10,000 LR alone - the fact the field is not so . The lack of access audits , as Liberty Reserve operates in a jurisdiction that is weak in financial supervision , making verification or audit of reserves GOLD vs. LR in the market can not be done .
Conventional currencies are the most disadvantaged by the emergence of digital currency , because the process of buying and selling digital currency is always juxtaposed with conventional currency . Such as you want to buy 1 LR , you must swap the MYR ( Malaysia Ringgit ) worth 1 USD in order to get the LR 1 , in small quantities would not be felt , but what if it happens in the millions USD ? Please financial experts answer : P
State owners of conventional currency is certainly not a bunch with this , when the country's currency daam large amount then simply ' run' into an advantage for a company located outside its jurisdiction . In addition, with the use of anonymous so that those who have unlawful activities ( not listed online gambling , hacking / cracking , cyberporns and other cybercrimes ) can freely transact using Liberty Reserve .
In the case of Liberty Reserve , or a joint investigation inter-state joint investigation was woven by the U.S. government to investigate unlawful activities that use Liberty Reserve . Tactics are very simple and also fatal , if not able to catch the offenders who use Liberty Reserve , why not be turned off or disconnected only track ? In this case is Liberty Reserve , Inc. itself - it's just that then occurs when the line was disconnected - they are the users who use the Liberty Reserve is a digital currency for any legal activity inevitably be affected .
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