Indicating that virtual currencies like Bitcoin have tough times ahead, the head of European Union's police stressed the need for greater policing power to crack money laundering, allegedly pretreated through such currencies.
According to Reuters, Europol head Rob Wainwright said, "We're seeing that virtual currencies are being used as an instrument to facilitate crime, particularly in regard to the laundering of illicit profits."
The top official said that law enforcement agencies do not have capabilities to operate online, a vulnerability that is being exploited by miscreants.
He said, "Criminals are abusing those freedoms and damaging society and threatening the security of millions."
Europol works to coordinate security between its member countries and facilitate cross-border investigations.
Speaking with Reuters, Wainwright said new powers should be given to police to weed out "anonymous participants online".
Law enforcement agencies and banking regulators in several countries have called for greater scrutiny of virtual currencies and in many cases a total ban on their use. The alleged use of Bitcoins and other virtual currencies in funding terror organizations and money laundering activities becomes more of an issue every time hackers bring down exchanges or a loss of coins is reported.
Reuters said U.S. authorities last year force closed an underground marketplace called Silk Road as it allegedly allowed Bitcoin users to trade anonymously. The trial is expected to begin this November.
While the U.S. and many European countries accorded legal status to Bitcoin, Asian economies like India have taken a more cautious approach by restricting Bitcoin use. However there have been no official efforts to regulate Bitcoin exchange.
A Reserve Bank of India missive given out December last cautions users against Bitcoins and virtual currency saying they can be misused in money, while also citing other reasons to discourage their use.
