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NY officials: Virtual currency invites real crime

Virtual currency such as Bitcoins can be used by cybercriminals for illegal activities from drug deals to pornography, prosecutors say. Above, Bitcoin buttons at a recent conference.
Virtual currency such as Bitcoins can be used by cybercriminals for illegal activities from drug deals to pornography, prosecutors say. Above, Bitcoin buttons at a recent conference.Frank Jordans/associated press

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Authorities say the recent investigations of Liberty Reserve and the hidden website Silk Road, a vast black-market bazaar for narcotics and other contraband, demonstrate how the anonymity inherent in the use of virtual currency is attracting a legion of flesh-and-blood criminals.

‘‘The perpetrators feel they can more easily conceal their activity, their identities and their proceeds,’’ US prosecutor Richard Zabel said last month.

Hard cash carries the burden of needing to be physically smuggled and hand-delivered, Zabel said. By contrast, in the Silk Road case, ‘‘users were able to purchase drugs from drug dealers located anywhere in the world, essentially with a push of a button.’’

Manhattan District Attorney Cyrus Vance Jr. has sought controls on digital currency exchanges to tame ‘‘a digital Wild West.’’

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