Dem counters bitcoin backlash: Ban cash

If Congress wants to ban the virtual currency bitcoin, it might as well go ahead and ban cash, Rep. Jared Polis (D-Colo.) said on Wednesday.

After Sen. Joe Manchin (D-W.Va.) last week asked financial regulators to ban the money, which he worried could be used for money laundering or illicit activity, Polis fired back with a tongue-in-cheek letter of his own.

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“I write today to express my concerns about United States dollar bills,” he wrote to Treasury Secretary Jack Lew and five other regulators.

“The exchange of dollar bills, including high denomination bills, is currently unregulated and has allowed users to participate in illicit activity, while also being highly subject to forgery, theft, and loss.”

Polis mocked Manchin’s assertion that the relatively anonymous nature of bitcoins, which exist only online but can be traded for dollars or used to buy some goods and services, makes them any more attractive for illegal activity than other types of money.

“Dollar bills are present in nearly all major drug busts in the United States and many abroad,” he wrote.

Polis also noted that bitcoins, unlike dollar bills, are “carbon neutral.”

The letter poked fun at the emerging skepticism about bitcoins, which have gained notoriety in recent months.

While supporters say that the currency is only in its infancy and has the potential to revolutionize the way people pay for things, critics note its use in a series seedy businesses and the wide fluctuation in its exchange rate.

In recent weeks, an early bitcoin adopter and advocate was arrested for conspiring to launder money and the popular exchange Mt. Gox went bankrupt, taking hundreds of millions of dollars with it.

Bitcoin was the money of choice for the online black market the Silk Road, an outlet that sold drugs and other illicit goods, before it was shut down by federal agents last year.

The federal government has so far taken a relatively hands-off approach to the currency, but other countries like China and Russia have taken a more aggressive stance.

Law enforcement officials have tended to agree with Polis that the money is likely no more dangerous than American greenbacks.

The head of the Treasury Department’s Financial Crimes Enforcement Network told a Senate panel last year that cash “is probably still the best medium for laundering money.”