Dezember 5, 2020

Bruno Le Maire associates cryptos and terrorism … And gets tackled in return

Finance Minister Bruno Le Maire has once again made a link between cryptocurrencies and terrorist financing. But this time, he got tackled by Cyril Paglino, the creator of Starchain Capital.

The Minister of Finance spoke on the subject of cryptocurrencies on the set of Dimanche en politique on France 3. Asked about the financing of terrorism , Bruno Le Maire points to a ready-made culprit: cryptocurrencies.

Bruno Le Maire unfolds a scenario where a radicalized person would finance Islamist associations abroad:

“I’ll give an example: cryptocurrencies. You can go and collect 150 euros in a tobacco bar, then 150 euros in another tobacco bar, ultimately collecting a large sum […] that an Islamist association or a fighter located abroad can withdraw in cash , abroad without any trace . “

Willingly or not, the Minister of Finance does not bother with details. In his scenario, it is possible to cash out cryptocurrency anywhere in the world. In practice, this is of course not the case. In addition, companies that allow Crypto Revolt to be purchased in the form of coupons in tobacco shops … Have particularly thorough identification measures , so there is no anonymity when buying cryptocurrencies from this way.

It will also be recalled that for the moment, only BTC is accessible by this means. And it is by nature very traceable, since all transactions are recorded in a distributed ledger . In the event that a person managed to buy Bitcoin anonymously, the transaction would still be visible.

The reality is more complex

The Minister of Finance concludes, however:

“Cryptocurrencies pose a real problem in the financing of terrorism, I have been saying this for years.“

Except that the reality is much more mixed. If terrorist groups have shown an interest in cryptocurrencies, they are not really using them for the moment , because they remain difficult to convert into fiat. Most of the time, these are assumptions on the part of politicians, who believe that terrorist groups could use cryptocurrencies heavily in the future. Like a year ago, when the Secretary General of the Treasury of the United States explained at a conference :

“ Although most terrorist groups rely primarily on the traditional financial system and cash to transfer their funds, cryptocurrencies could become the new frontier .”

Cyril Paglino tackles Bruno Le Maire

This is what displeased Cyril Paglino. The former Secret Story participant made a name for himself in the French-speaking crypto sphere by founding Starchain Capital and by participating in the development of the startup incubator The Garage .

On Twitter, he explained to Bruno Le Maire the limits of his argument:

As the crypto community keeps repeating, cash is not banned, on the pretext that it is almost untraceable and that it can be traded freely. Why then want to do it with cryptocurrencies?

Paglino also recalls that the classic financial system, including large banks, has rather dirty hands when it comes to the financing of terrorism:

So yes, it is important to prevent terrorist groups from financing themselves as much as possible. But to mention cryptocurrencies as a major axis of terrorist financing is simply wrong. So is it really a desire to prevent the financing of terrorism, or a way to point the finger at an easy target? After all, cryptocurrencies are just starting to shed their bad reputation.

We can therefore doubt the effectiveness of this type of maneuver on the financing of terrorism. And regret once again the lack of openness of Bruno Le Maire and the French government in the area of cryptocurrencies.