Pre-Bitcoin anonymous payment channels

Peer-to-peer electronic payment services existed before Bitcoin. PayPal was explicitly intended to be an anonymous regulation-dodging money transmission channel, with an anti-state ideology; in a 1999 motivational speech to employees, Peter  Thiel rants  how “it will be nearly impossible for  corrupt governments to steal wealth from their people through their old means”10 – though they quickly realised that being part of the system made for a much more viable business.

  • Gold was a digital currency backed by gold, founded in It was perceived as anonymous but was actually pseudonymous, and the  company made their records available to law enforcement. It was quite popular before being shut down in 2009 for not having obtained a money transmitter’s license in the previous several years.

Liberty Reserve in Costa Rica operated from 2006 to 2013. It was all about the anonymous money transmission, and founder Arthur Budovsky (who had previously been convicted for running a similar operation in the US) ended up jailed for 20 years for money laundering. Some Bitcoiners regarded Liberty Reserve as a predecessor to Bitcoin and worried at the possible precedent this might set.

Related Articles