In an era of increasing regulations, investor caution and forensics tracking cryptocurrencies to nefarious parties, “virgin” Bitcoin that has never been traded or moved is reportedly fetching a premium price.
Flex Yang, the CEO of Babel Finance, a Hong Kong-based cryptocurrency financial services provider, penned an article in Bitcoin Magazine about how investors are responding to recently unveiled Financial Action Task Force regulations.
“Bitcoin has, in a sense, become the new trust fund. Buyers have entered the market for virgin bitcoin, in large part, due to their novelty. With such coins, there persists a notion of rarity and exclusivity, prompting buyers to pay as much as a 20 percent markup on coins with no transaction history.
Adding additional value is the fact that the virgin coins are believed to comply with the recent FATF recommendations. Virgin bitcoin might not benefit family funds or individuals making the purchase. Still, there is clearly more confidence in virgin coins, and they continue to fetch high premiums.”
Among the new guidelines, the FATF requires companies engaging in crypto transactions to include the name of the sending customer, account number, physical address or national identity number – not just a transaction number – and the recipient’s name and account number.
Unlike cash that circulates around the globe with recipients having no knowledge of whether the bills they possess have funded a charity drive or a drug deal, the information required for Bitcoin transactions could unwittingly tie current recipients to prior illicit transactions.
Yang notes that institutional investors remain interested in BTC but have little appetite for risk – leading to the caution-oriented interest in virgin coins. Bitcoins without transaction history can’t have any skeletons in their closet, he explains.
“While demand for the virgin coins continues to increase globally, mining operations in China are continuing to thrive. The newly assigned confidence in virgin coins has put the untainted coins at a premium.
The fear of tainted cryptocurrency planted the seed for the virgin coins. Without any transactional history, there is essentially no risk of the coins being seized or frozen due to their involvement in questionable past dealings.”[the_ad id="42537"] [the_ad id="42536"]