It was announced earlier this week that a significant group of prominent Bitcoin companies, individuals and institutions have united in a "Blockchain Alliance." This alliance will serve as a resource for law enforcement to help combat criminal activity involving bitcoin and the blockchain, and has so far engaged with the Department of Justice (including the FBI and the U.S. Marshals Service), the U.S. Secret Service, Immigration and Customs Enforcement, Homeland Security Investigations and the Commodity Futures Trading Commission.

However, the Blockchain Alliance was not welcomed by the entire community.

One of the fiercest opponents of the initiative has been Bitcoin Foundation Executive Director Bruce Fenton. Shortly after the Blockchain Alliance was announced, Fenton took to Internet forums and Twitter to voice his concern about the industry's outreach to law enforcement.

Speaking to Bitcoin Magazine, Fenton explained why:

Bitcoin's relative anonymity has obviously led to it being used for criminal purposes. Don't you consider that a problem that needs solving?

First off, I challenge the notion that the American government has an absolute and irrefutable right to know all financial information and private records of every person within our borders. This is a relatively new idea, and it's a very bad one. Some things are just not their business, and the fact that I'm a little afraid to say that out loud shows how sad our current state is.

As for criminal activity, note that something being a crime is not always a measure of morality. In some countries right now being gay is a criminal act. Even in the United States we once had segregation mandated by law. "Aiding a runaway slave" was once a crime... Would we have wanted to "partner with law enforcement" to track the blockchain for purchases made by escaped slaves?

Today we have laws related to asset forfeiture and federal prosecution of crimes which voters in states decided to decriminalize. These are actions by law enforcement that many citizens feel are immoral.

But Bitcoin can also be used for criminal purposes that we probably all agree are undesirable. Extortion comes to mind.

Sure, Bitcoin makes some bad things easier to do -- just as do shoes, phones and the Internet. But it's unwise to punish technology and innovation rather than the actual harmful actors.

The Blockchain Alliance is established exactly to help law enforcers make this distinction...

But taking care of these bad actors is the responsibility of the law enforcers, not that of the innovations or the industry. Cars make it far easier for criminals to escape than by foot, but the technology of the motor vehicle and its industry has no responsibility for this.