The past few years has seen an increase in interest regarding cryptocurrencies and blockchain technologies. In recent months multiple Canadian agencies have been researching various aspects of the divisive asset class.
In an effort to understand the intentions of ATM operators, the CRA recently commissioned research group ‘Sage Research Corporation’ (SRC) to look into the situation. Compensated to the tune of $33,000 CDN tax payer dollars, SRC found the following:
Of those polled, it was found that there was no common intention among them. The reasons for store placements varied from investment purposes to customer convenience.
Number of crypto ATMs in Canada – 300 and growing
Number of crypto ATM operators polled – 20
Unfortunately, the completed study appears to be completely skewed, and rife with conjecture. Questions asked were related to the operator’s impressions of the individuals using the machines. With no actual insight into why the users were using the machines, operators are free to impart their biases and stereotypes.
One genuine concern does arise. There were reports of operators stepping in and stopping people from getting scammed. Over the past year Canadians have been subject to an on-going telephone scam. This often transpires when a Canadian gets a call from an individual claiming to work for the CRA. They then threaten the individual with legal action unless they send BTC to a digital wallet in prompt fashion. While these types of scams have been prevalent for years, with the advent of BTC, scammers have found an easier way to steal.
Overall, 50% of the operators suspected illicit activity on behalf of the ATMs users. This comes right as the United States Department of Justice released their findings on illicit activity. What they have found is that less than 10% (and falling) of Bitcoin transactions pertain to illicit activity.
For those that are believers in blockchain technology, the Bank of Canada recently released good news. In a study released in July 2018, the Bank issued findings stating that double spending and 51% attacks are simply not likely.
Focusing specifically on POW protocols, the study took an in-depth look at how double spending attacks could occur. The overall consensus was that double spending attacks, “…tend to be unrealistic and, in practice, users have little economic incentives to launch such an attack, especially when the computational investment by other miners is large.”
The Bank of Canada did cede that an illegitimate miner with enough financial weight would be able to stage a 51% attack; Previous reports have shown that although rare, they can in fact happen. Due to the difficultly of such an attack rising along with the hash rate of a network, it is smaller blockchains that are more susceptible.
What these studies show, on behalf the CRA, is the rising interest in the technology among the influencing bodies within the nation. Other studies have pointed to a potential $35 billion CDN dollars in savings by 2030 to be seen by banks through the implementation of blockchain. It is no wonder that interest is rising. Although the market is slumping right now, the technology isn’t going anywhere, and the powers that be recognize it.