Cryptocurrencies Are Troubling, Says Bank Of America Official

News | May 11, 2018 By:

Cathy Bessant, chief technical officer of Bank of America (BofA), said that cryptocurrencies impede the ability of the authorities to catch criminals.

In an interview with CNBC’s Squawk Box, Bessant said it’s important to differentiate the two major uses of cryptocurrencies. As a payment system, she thinks cryptocurrencies are troubling because the technology is “designed to be not transparent.”

“I think it’s troubling because the foundation of the banking system is on the transparency between the sender and the receiver, and cryptocurrency is designed to be nothing of the sort, in fact it’s designed to be not transparent,” Bessant said.

She added that the design of the technology makes it more difficult to police business transactions in cyberspace, and hinders banks’ attempts to catch “bad guys.”

“The way we sort of quote-unquote catch bad guys is by being transparent in the financial moment of money,” she said. “Cryptos is the antithesis of that.”

In February of this year, BofA placed a ban on cryptocurrency transactions via credit cards, citing anti-money laundering regulations, as well as the potential for thieves to convert stolen credit cards into cryptocurrency stashes.

Bessant said their customers are free to choose to invest in bitcoin if they so wish. One thing they can’t do, though, is use a Bank of America credit cards to make crypto purchases.

“Just like we don’t allow stocks to be purchased on our credit cards, we’re not going to allow cryptos or other currencies to be purchased on our credit cards,” Bessant said.