Why Gun Manufactures Are Embracing Bitcoin

Posted on  

"Why Gun Manufactures Are Embracing Bitcoin"

Gun

CREDIT: Shutterstock

Gun manufacturers are now the latest in a growing list of businesses that are accepting cryptocurrencies. Texas-based TrackPoint — which makes a $28,000 rifle that can hit targets at 1,000 yards away — announced Thursday that customers could start paying for products with Bitcoin. But the addition of digital currencies to the already poorly regulated gun market could make illegal gun sales easier and harder to control.

One of the biggest appeals of cryptocurrencies like Bitcoin is that the funds are virtually untraceable and cloak buyers’ identities. Merchants who take cryptocurrencies aren’t hit with processing fees like with credit cards, making them an attractive payment option for mainstream retailers like Overstock.com, arms dealers and private sellers alike.

Bitcoin’s anonymity probably won’t be a problem for TrackPoint, which, as a federally licensed manufacturer, has to run background checks on all gun buyers regardless of the form of payment. Even if customers pay with Bitcoin, the currency won’t shield the gun buyer’s identity. TrackPoint will still know who they are.

But cryptocurrencies are also becoming popular among private sellers, which don’t have to run checks on buyers. That’s when Bitcoin-bought guns become a problem. Only 14 states and Washington, D.C. require checks for private handgun sales. And with the surge of online gun sellers, taking crypotcurrencies just compounds the problem, Chelsea Parsons, associate director of crime and firearms policy for Center for American Progress, told ThinkProgress.

Running a background check takes only a few minutes and looks at histories of both criminal and mental illness. But private sellers can skip the paperwork without repercussions. Over 60 percent of ads for private gun sales openly say they’re willing to sell to individuals who wouldn’t likely pass a background check, according to a New York City Mayor’s Office investigation in 2011.

“Armlist and similar sites function as unregulated bazaars, where the essential anonymity of the Internet allows unlicensed sellers to advertise scores of weapons and people legally barred from gun ownership to buy them,” The New York Times reported. Also, nearly all of Armslist’s tens of thousands of ads posted weekly are from private sellers who don’t legally have to conduct background checks. Congress took up the background check debate last year after the Sandy Hook Elementary School shooting in Newtown, Conn., but the U.S. Senate failed to pass a comprehensive gun bill that would expand checks to all gun sales.

“The biggest risk is in these online private sales. There’s increasing concern in the use of the internet to buy guns,” Parsons said. Buyers can turn to underground dealers like Silk Road, which gained infamy for accepting Bitcoin payments, e-commerce sites such as Armstice, and even social media to get a gun. Both Facebook and Instagram have had to update their policies to address the growing number of users from soliciting gun sales on the sites.

A lot of times, private sellers are selling guns to strangers, and Bitcoin’s ability to foster anonymity just exacerbates the problem. “With levels on levels of anonymity, who wants transactions like that? People who aren’t allowed to have a gun,” Parsons said. Illegal gun sales are already a massive problem on their own without cryptocurrencies, but sellers accepting them certainly isn’t helpful, she said.

Universal background checks could neutralize the danger of cryptocurrencies. Studies show states with expansive background check requirements cut down on illegal gun trafficking and on murders. Most Americans support universal background checks for all gun sales, regardless of political affiliation, according to a Pew Research study.

« »

By clicking and submitting a comment I acknowledge the ThinkProgress Privacy Policy and agree to the ThinkProgress Terms of Use. I understand that my comments are also being governed by Facebook, Yahoo, AOL, or Hotmail’s Terms of Use and Privacy Policies as applicable, which can be found here.