Perhaps the strongest thing about Bitcoin transactions is its anonymity. This is because transaction verification does not happen through checking identities but via a complex algorithm. But this very aspect of Bitcoin is what has endeared it to criminals and underground market dealers. In the process, this has earned it the wrath financial regulators and government officials.
An Australian-based has announced plans to introduce a digital currency called Identabit that will allow regulatory acceptance by means of user association. Called Thinking Active, the startup categorizes Identabit as the first decentralized identity-ensured currency. Identabit represents a means of liberating decentralized currencies and many are already saying that this will be the ultimate Bitcoin replacement.
Identabit was borne out of collaboration between Cryptonomex and Thinking Active. Cryptonomex is a Virginia-based firm led by Dan Larimer while Thinking Active is owned by John Underwood, a New York-based software entrepreneur. Larimer has been identified as one of the brains behind Blockchain 2.0 project, BitShares.
Bitcoin Plus Identities
Despite the closure of Silk Road and increased attention on Bitcoin transaction that may involve criminal transactions, digital currencies are still being rampantly used in ransomware attacks by hackers. As a result, it has made it all the more difficult for government authorities to trace payments, something that has led to most governments to be skeptical about Bitcoin.
Although the underlying technology known as Blockchain has tremendous potential in disrupting different industries given its more practical applications, government agencies seem hell-bent to suppress innovation with compliance. To offer something of a compromise, Identabit seeks to come up with another version of Bitcoin but one that is identity-based. This will allow the development of Identabit without the element of criminal activity.
Because Identabit is basically creating a permission-based ledger, it will not necessarily leave all transactions open to public scrutiny. Those behind Identabit claim that they are able to process 4x transactions of MasterCard and 6x transactions of Bitcoin network.
Is Identabit Superior to Bitcoin?
If the information from the Identabit website is anything to go by, Identabit meets counterterrorism and anti-money laundering acts. In other words, this makes it unusable for felons. It uses technology that makes it superior to Bitcoin in more ways than one. The technology that it uses is called DPos or Delegated Proof of Stake and it’s a fairly new technology. This has given it a transaction capacity that exceeds that of MasterCard, while the transaction capacity of Bitcoin is a meager 0.035 of MasterCard’s. Similarly, Bitcoin has a big disadvantage in that once the money is transferred, it cannot be recovered.
However, since Identabit requires that the identities of both parties be revealed, it enables disputing of transfers as well as recovery. This is because of the plenty of digital proof. In some ways, Identabit is more preferable and also more secure compared to Bitcoin.
How Will Identabit Introduction affect the Deep Web?
At the start, people seemed to be quite taken with the novelty of anonymous and safe currency such as Bitcoin. However, due to the public bashing that Bitcoin received, more people don’t want anything to do with this anonymous currency. Identabit seems to be the answer and has tapped into the fear of law enforcement by the public. It’s a privacy minded digital currency that also complies with all elements of the law. Looking at the wider scope of things, it spells trouble for darknet markets.
A theory has been advanced to the effect that majority of people who buy drugs on darknet markets like Silk Road don’t do so primarily because they need drugs or other illegal items. Rather, they do this for the novelty of online drug trade.
It’s possible that these people initially bought into the Bitcoin concept and then began to explore more ways of spending their newly acquired currency. The deep web almost always pops up when people search for Bitcoin, something that tempts people to explore about it a bit more. This might mean that a user eventually ends up at Abraxas or other markets, whereupon they will be overawed by the sheer fact that places like that even exist.
Instead of just window shop, a user is stimulated to purchase the goods by the ease of buying unlawful goods and the relative safety. But given that Bitcoin popularity has been under steady decline, coupled with heightened vigilance from law enforcement, darknet markets have been gradually losing customers and revenue. It is possible that the exit scams that many successful darknet markets committed were not simply to get customers enraged but to get out of business fast before Interpol catches up with them and before Bitcoin value comes down crashing.
The net effect is that the deep web will eventually experience a slow decline and a remarkable decrease in their user bases. Bitcoin is simply not the place to rake in the money anymore. The ever decreasing interest in Bitcoin is a major concern for deep web, no doubt.
Identabit will usher in a new era of cryptocurrency, and in the process it will devalue as well as stigmatize the Bitcoin. It is sad to say but the Bitcoin that all of us loved might be sliding quickly into oblivion.