The unveiled creator of bitcoin just revealed his identity. Since 2009, he has been known as an anonymous person named ‘Satoshi Nakamoto’. Nobody has known if he is one single person or a group of people. Recently, Craig Wright, Australian IT entrepreneur and a computer engineer, has claimed he is Satoshi Nakamoto - the creator of bitcoin. However, some experts still doubt his real identity.
  As attention to the bitcoin is growing, the frequency of using it is also increasing. However, we can’t ignore some problems with bitcoin happening these days.
  Bitcoin is a digital virtual-currency without special or physical shapes like normal bills or coins. Actually, there are already some virtual currencies on some web sites such as ‘Facebook-credit’ in ‘Facebook’ or ‘Dotori’ in ‘Cyworld’, but the most important characteristic that makes bitcoin different from other currencies is that the bitcoin is decentralized. In other words, there is no single institution which controls how it works. Anyone who makes the bitcoins or transacts them can be owners of them. Therefore, the bitcoin has anonymity and it can be distributed quickly.
  On the other hand, there are a number of problems with bitcoin’s characteristics. People use bitcoins for some secret or illegal trades. In the case of the U.S., the NYPD(New York City Police Department) announced that the judicial authorities impounded a lot of bitcoins that were worth about 28 million dollars (about 297 billion won) in October, 2013. It is because of drug peddlers who use bitcoins secretly for trades to avoid surveillance from the authorities.
  In the case of Korea, as some companies of bitcoin have been founded recently, such as ‘Korbit’ or ‘Bithumb’ in 2013 and 2014 respectively, the number of people using bitcoin is growing, but also some problems are happening. On May 8th, SWDP(Seoul Western District Prosecutor's Office) announced that rapper Choi, from a K-pop idol band, was accused of drug smuggling. Choi used bitcoins as a payment to avoid pursuit, but he was eventually caught.
  Nowadays, a new kind of money fraud is arising from using bitcoins for money laundering. This March, the GPPA(Gangwon Provincial Police Agency) reported that 3 people, including a Korean-Chinese man named Kim, were arrested. They impersonated FSS(Financial Supervisory Service) to siphon off bank clients’ personal information and stole an amount of money. They thoroughly tried to keep the money by changing them into bitcoins, but they were caught in the end.
  In cyberspace, there are some new problems which damage a lot of computers by ransomware and take much money as bitcoins. Ransomware is a kind of computer virus that gets into personal PCs and prevents a PC’s program files from being opened and requires users to input decoding keys for a high ransom. These days, because of the characteristic that bitcoins are anonymous, ransomware distributors are asking for payment in bitcoins. It makes this problem worse because it’s too hard to find the distributors.
  About these new problems that bitcoins bring, Professor In-ho(Department of Computer Science and Engineering in Korea University) said, “A knife can be used in a good way or sometimes a bad way, depending on who uses it. Likewise, bitcoins are a double-edged sword.” He added, “The prospects of bitcoin will be different depending on how we define it and how laws and rules about bitcoins are established.”

By Oh Byung-hyun
bh37@cbnu.ac.kr