Regulators and banks are escalating warnings against bitcoin and other digital currencies amid concern such software lends itself to financial crime. Bitcoin enthusiasts suffered a blow last week when it emerged Charlie Shrem, head of a New York bitcoin exchange, was charged with attempting to sell bitcoins to narcotics traffickers. The central bank of Estonia, where Swedish banks dominate the lending market, urged consumers to steer clear of bitcoin and similar virtual currencies, warning such software could prove to be little more than a Ponzi scheme. Mihkel Nommela, head of the Estonian central bank’s payment and settlement systems department, said that Bitcoin “is a problematic scheme.”
