Cryptocurrencies cause deaths: Bill Gates

Bill Gates says cryptocurrencies can be used easily to purchase drugs online and have "caused deaths in a fairly direct way". Picture / AP

Bill Gates, the co-founder of Microsoft, has criticised the anonymity of cryptocurrencies such as bitcoin, saying the use of digital cash has led to deaths.

The world's second richest man took part in a Reddit "Ask Me Anything" session this week, during which he was asked about his thoughts on cryptocurrency.

The technology has soared in popularity over the past year as the price of bitcoin climbed to nearly US$20,000 ($27,762) before falling back to trade at about US$10,400.

Part of the appeal of the digital cash is the anonymity it grants holders. It uses decentralised technology for secure payments and storing money that does not require banks or people's names.

But while that feature is lauded by some, Gates said it was not "a good thing".

"The government's ability to find money laundering and tax evasion and terrorist funding is a good thing," Gates wrote. He also noted that cryptocurrency can be used easily to purchase drugs online and had "caused deaths in a fairly direct way".

"Right now cryptocurrencies are used for buying Fentanyl and other drugs so it is a rare technology that has caused deaths in a fairly direct way. I think the speculative wave around ICOs and cryptocurrencies is super risky for those who go long."

One Reddit user pointed out that people can also buy drugs with regular cash.

"Yes - anonymous cash is used for these kinds of things but you have to be physically present to transfer it which makes things like kidnapping payments more difficult," he said.

I think the speculative wave around ICOs and cryptocurrencies is super risky for those who go long.

Bill Gates

The criticism contrasts with Gates' praise in 2014 when he said bitcoin was "better than currency", and that it was "exciting because it shows how cheap [transactions] can be".

He has also praised the technology behind it. During a BackChannel interview in 2015, he said people needed to "draw on the revolution of bitcoin, but bitcoin alone is not good enough".

As a sign of the benefits he sees in the field, the Bill & Melinda Gates Foundation partnered with cryptocurrency firm Ripple in October in a bid to help those around the world who are unable to use or access banks.

Ripple has been soaring in popularity and has been closing in on bitcoin's market lead.