IDentabit: Bitcoin loses its anonymity

     Perhaps one of the most important features of Bitcoin transactions is their anonymity, which allows transactions to be confirmed by a complex algorithm without the need for real identity verification. However, this feature has led to Bitcoin's widespread use in criminal activities and underground markets, angering governments and financial regulators.

     Australian startup IDentabit plans to create a bitcoin alternative that requires identity verification to help break the cryptocurrency's connection with illegal transactions and money laundering. It will also help bitcoin and blockchain technology products be more acceptable under existing regulations.

Adding identity verification to Bitcoin

     Even though Silk Road has closed down and the government has stepped up its oversight of bitcoin transactions that could be linked to illegal activity, the virtual currency is still widely used by hackers for malware attacks, making it difficult for regulators to track every spend, leading to government distrust of bitcoin.

     The blockchain technology that underlies Bitcoin has great potential, and its more practical features can have a huge impact on many companies, but even so, regulators are trying to suppress this technological innovation. As a compromise, IDentabit is planning to create a Bitcoin alternative that requires identity verification so that Bitcoin can continue to develop without the perception of illegal behavior.

     Because IDentabit is developing legally permissible bills, it does not need to disclose all transaction details to the public. This will be a product jointly developed by Thinking Actively and Victorian software company Cryptonomex. So far, Cryptonomex claims that this product will process three times more transactions than MasterCard and five times more than the Bitcoin network.

     On the About Page, IDentabit states: “We have been forced to watch the disintegration of decentralized technology and the government’s encouragement to withdraw deposits from banks and invest directly. We believe that attempts to get regulators to accept Bitcoin have failed, but there is a possibility of finding another currency that will neutralize the characteristics of Bitcoin and can be accepted by governments.”