The largely ungoverned nature of crypto-currencies is what has made them a desirable tool for those involved in borderline-legal transactions. The prominent black market players engaged in illicit circulation of drugs and weapons have chosen BitCoin as their preferred means of payment. A few years ago, in 2013, the US authorities conducted raids to retrieve a substantial amount of BitCoins from the Silk Road, a major black market organization. The seizure totaled $25 million, and 50,000 BitCoins were auctioned out after the confiscation. The investigation revealed an executive of a Credit card to Bitcoin exchange was involved in facilitation of illegal USD-BTC exchanges carried out by the Silk Road. The person was held liable, and spent 2 years in jail for their crimes.
In addition, getting hacked has recently been quite a headache for companies engaged in exchanging digital currencies, since a portion of the funds they have in circulation is always kept in online wallets. One of the headline-making hacker attacks recently fell upon Mt. Gox, an exchange enterprise headquartered in Japan. As a result of a massive security breach, the company found itself short of 850,000 BitCoins. Such a major loss of funds resulted in Mt. Gox going bankrupt. The Tokyo authorities conducted an investigation, which revealed the security breach could’ve been an inside job, with one of the CEO of Mt. Gox to hold liable.
In 2014, an explosive headline was made public by Newsweek, which claimed to have discover who had been hiding behind the pseudonym “Satoshi Nakamoto” (the famous and notorious creator of BitCoin). The publication pointed at a native resident of California of Japanese descent, Dorian Nakamoto. In turn, he denied being anyhow related to creation of the crypto-currency, and was even going to file a lawsuit against Newsweek for disrupting his and his family’s peaceful life with their allegations.