Canada hosts one of the largest numbers of Bitcoin ATMs in the world. Considering Canada’s much smaller population compared to the United States and the number of Bitcoin ATMs available, it’s safe to say that it has the most ATMs per citizen in the world.
However, the title may have already given away the topic of this article, which will be the controversy of Vancouver’s mayor wanting to place a ban on Bitcoin ATMs simply because there are alleged cases of money laundering.
In fact, the mayor did bring in quite a lot of realistic argument, which mostly have to do with the cost of obtaining and installing a Bitcoin ATM in Canada and then simply withdrawing or depositing illegal cash through them right in the middle of one of Canada’s largest cities.
Will this prevent money laundering?
As already mentioned the mayor expects that money laundering cases will decrease if Bitcoin ATMs are removed from the equation but that may not be the case. The most the ban could do is simply complicate things a little bit for the “launderers”.
The best way to go about the issue is to simply commission several companies in the country which will be given permission to install and operate these ATMs. This isn’t necessarily suggesting a monopoly, but a healthy competition based industry in Canada.
Placing a complete ban could potentially harm one of Canada’s largest industries. It may seem completely unrelated, but in all honesty, it’s the only alternative launderers could be looking for.
What will the ban harm?
The gaming industry in Canada is quite strong, the shared history with the United Kingdom has left a mark with Canadians to enjoy a few wagers here and there, much like Australians do. Therefore, the gaming industry in the country has seen massive growth over the years, becoming the country’s main “taxpayer” and a great profits provider for investors.
One important thing to note about Canada’s gaming scene is that the online sector is starting to become much more popular than offline, which creates a small bottleneck. Most of the Bitcoin casino games Canada has to offer come from offshore companies.
So what does this have in correlation with Bitcoin ATMs?
The correlation is quite simple. Having Bitcoin ATMs removed from the equation those who used to launder money through them are going to switch to online gaming websites. This would entail depositing unregistered or “laundered” cryptocurrencies on the platform and withdrawing them in cash bit by bit.
This would introduce a whole new issue of tracking these events for the Canadian government as very little reports are required from offshore companies in terms of client deposits, especially when it’s in Bitcoin.
In the end, the Canadian government would be shooting itself in the leg, by providing criminals a much more “secure” platform for processing laundered money.
However, if I’m writing about this then the government is aware of it as well right? This awareness has birthed a new initiative in the country which entails a much stricter regulation of the online gaming industry, which is predicted to tank the income of licensed companies by quite a bit.
Naturally, most of the companies that hold a license in Canada are publicly traded as there are some standards they should meet. Decreased revenue and a much more complicated industry to operate in would naturally tank the stock price as well, painting Canada as a very unprofitable market to work in.
Although these conclusions may seem a bit far fetched, it’s important to note that most of the economy is somehow connected to each other in every country. Taking one block out of the Jenga tower always has the risk of making it collapse completely. All the removal needs are some diligence and accuracy, and in Canada’s case, Bitcoin ATMs are definitely not the block they should be going for.
What will happen in the US?
Judging by the fact that a large majority of online gaming websites operating in Canada are United State-based it’s already obvious what will happen to those companies.
Add to that the relatively free movement between the two countries and the US could expect a large influx of migrating Bitcoin ATM owners, some of which could prove to be those alleged money launderers.
All in all, the main hit will be directed to Canada, but the collateral damage will reach the USA one way or another, which is definitely not in the interest of the current administration.