It has been less than a week since the story appeared on Wall Street Journal accusing Erik Voorhees and his company ShapeShift of providing a platform to criminals to launder their money. This accusation was obviously, had not gone down well with Erik who immediately tweets expressing his concern over the article. In the latest addition to this, Erik has now used his medium channel to submit a detailed post countering the claims the WSJ article had made.
Erik Strikes back to WSJ on claims of money laundering
Erik, in his post on medium, gives a complete account of how the WSJ collected the information and how have they misrepresented the facts accusing ShapeShift of money laundering.
— Erik Voorhees (@ErikVoorhees) October 2, 2018
He says that the WSJ reporters reached out to them months ago asking for friendly assistance on a piece about the crypto industry in general. They worked with Shapeshift for five months where Shapeshift was very open and accommodating of their questions. According to Erik, this was information which the journalists collected and misrepresented in their article. He also adds that of the many things Wall Streetand his team communicated with them over the past months, the writers did not include a single statement from those lengthy discussions add instead have included only out-of-context remarks which he had made elsewhere.
He also has accused WSJ of omitting relevant information which was shared with them over multiple phone calls, in-person meetings, and emails. These facts include (quoting from the post):
- $9m (even if it was true) is 0.15% of ShapeShift’s exchange volume during the described time period;
- ShapeShift has a strong record of complying with law-enforcement requests, providing valuable assistance in over 30 investigations in 13 different countries all over the world;
- The company works with other exchanges on an almost-daily basis to identify and block thieves and criminals, through a self-policing group ShapeShift created to protect the users and industry;
- Shapeshift blocks entire countries on the sanctions lists
- The company also has an internal anti-money laundering program that uses blockchain forensics that are far more advanced (and we would argue, effective) than asking someone for their “name and address”;
- The company also blacklist suspicious addresses upon learning of them.
These are the facts the article has completely ignored even when they were provided to WSJ’s journalists. According to Erik this article was published only to draw a narrative that bitcoin is still used to launder money and people should avoid it.
The article was written to malign cryptocurrencies
The article that was published on September,28 2018 by Wall Street Journal titled “How Dirty Money Disappears Into the Black Hole of Cryptocurrency” written Justin Scheck and Shane Shifflett had put forward the narrative that says that anyone who wishes to launder their dirty money, be it A North Korean agent, a stolen-credit-card peddler and the mastermind of an $80 million Ponzi scheme, uses ShapeShift AG and anonymously converts it to cryptocurrencies. The write up goes on further to target privacy coins like Monero which are completely untraceable and best hideouts for money launderers. The article had gone ahead to accuse Shapeshift and its policies by saying
“After hackers believed to be from North Korea extorted millions of dollars in the so-called WannaCry ransomware attack on businesses and governments, the criminals used ShapeShift to convert bitcoin into an untraceable cryptocurrency called Monero, security researchers found. For the next year, ShapeShift made no changes to its policy of not identifying its customers, and continued to process millions of dollars in criminal proceeds, according to the Journal investigation.”
Joseph Young, the renowned crypto journalist, had also shared his displeasure saying that the mainstream media puts forward false narratives on cryptocurrencies and ditch it but never actually an emphasis on news of much larger frauds and embezzlements that happen in the traditional world of finance.
A bank in Denmark laundered $230 billion. Why are we even talking about $9 million on crypto exchanges?
This isnt really about money laundering in case it’s not obvious yet. It’s about pushing a narrative that crypto is criminal money.https://t.co/F77XOxtenK
— Joseph Young (@iamjosephyoung) September 29, 2018
With this post, Erik has clear out that ShapeShift doesn’t get into activities which the article falsely claims. This has also exposed the mainstream media of how they twist and turn the news to present a narrative which sells their stories rather than actually portraying the truth.
Do you agree that mainstream media plays a key role in spreading false news about cryptos? Do let us know your views on the same.
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Nilesh Maurya has been associated for past 8 years as an Investment Banker with Omega Capital, a bespoke Investment Banking outfit having offices in Mumbai, New York, Singapore, and Dubai. He has been a regular contributor to business publications such as Business India and Market Express and has been a mentor to many start-up companies. Nilesh Maurya has been associated for past 8 years as an Investment Banker with Omega Capital, a bespoke Investment Banking outfit having offices in Mumbai, New York, Singapore, and Dubai. He has been a regular contributor to business publications such as Business India and Market Express and has been a mentor to many start-up companies. Follow him on Twitter at @KoinKing1 or connect with me on linkedin.