The Goldman Sachs Embezzlement Affair Demonstrates Bitcoin’s True Value
There are a number of things that even the most crypto-critical individuals can look at in order to assess the value of cryptocurrency.
One of them is a recent report that was published in the New York Times, where it detailed the fact that Goldman Sachs bankers have been successfully brought to heel after it was found that they were responsible for a massive multi-billion dollar embezzlement scheme in league with the former Prime Minister of Malaysia, Najib Razak.
The former prime minister used these proceeds from the scandal in order to purchase luxury items and fund his otherwise extravagant lifestyle.
There's nothing remarkably special about this scandal in particular. It's something that happens more frequently than we'd like to think. It's something that happens quite commonly in current, or “legacy”, financial systems. Razak created and oversaw a “sovereign wealth fund,” and with the help of a number of Goldman Sachs bankers, embezzled and misused the funds in outlandish ways including the purchase of a Picasso.
Of Prime Ministers and Picassos
It's been revealed that the Prime minister had received over a billion dollars of the funds in his own private bank account, enriching himself to the point of an exceptional extreme.
For a time, he had become extremely wealthy by any standard. Ironically enough, the US federal prosecutors seem to be the most active in response to this series of criminal activities, prosecuting two Goldman Sachs bankers thus far, and it's believed that more will be following. One of those prosecuted, it's been reported, has already pleaded guilty to charged put against him.
When it comes to Goldman Sachs, this isn't the first time that it has been involved in some level of financial misappropriation or misconduct. At the same time, when we look around the banking industry as a whole, there's not really such a thing as 100% clean hands in one way or another.
now, if only there was some kind of system that would enforce a strong level of transparency in any transactions that takes place between one party and the other. Such a technology would inherently eradicate fraud as a thing, if only it existed. Oh wait, it does, it's called blockchain.
The Current Systems are Failing us
An important passage from the NYT report reads [emphasis added]:
“The authorities said that at least one high-ranking executive in the bank’s Asian operations was aware of the scheme, which dodged Goldman’s systems to detect the payment of bribes. That person, unidentified in the court filings, has not been charged. According to three people familiar with the matter, the executive was Andrea Vella, who was the co-head of Goldman’s Asian investment banking business.”
Now, this section is important because it otherwise demonstrates that the traditional banking sector actually does understand that there are limitations that it has to otherwise contend with. And that it does want what we have natively in the cryptocurrency and blockchain space: and those are the methods of preventing fraud and misuse of funds.
These kinds of opaque practices and institutions always have and always will present us with the opportunities for fraud and abuse. Transparency, as is otherwise innate in all public and private blockchains, is a core way of remedying this endemic problem.
Essentially, it is suggested that such fraud, as was conducted by the agents of the 1Malaysia Development Berhad (1MDB) is basically impossible to get away with in a blockchain enabled ecosystem.
The Blockchain Actively Renders Fraud Impossible
The criminal element will forever develop ways in which to get around any countermeasures designed to prevent fraud from happening. Allowing the dishonest to get around being kept honest. AI such as those found in neural networks could be trained to watch for particular behaviors that have previously been spotted in fraud attempts, allowing for some proactive measures to be taken in such instances as the one we have recently been discussing.
It took roughly two years for any sort of justice to be served to those involved. Two men apart from Tim Leissner, the banker that had already pleaded guilty to his charges, were allegedly involved. One of them has yet to be arrested, meaning it could be a couple more years before the matter is finally resolved.
The overall conclusion is this: If a conspiracy of this sort of scale only required that many participants, then there are plenty of other good methods of applying blockchain that can prevent these sort of malpractices from happening in the future.