Hold on to your tinfoil hats folks!

“Blockstream is pleased to announce today a strategic partnership with PwC” (PricewaterhouseCoopers) source

When I read the release I was really not sure how to feel. I mean PwC is a giant multinational corporation, implicated in pretty much every major financial fraud in the last decade. So, I decided to put on my tinfoil hat and do a little research. This is completely biased and looks at PwC’s relationship with Blockstream/Bitcoin Core from an adversarial stance.

A little about our new reptilian overlords:

Largest professional services firm in the world

$35.4 Billion in revenue for 2015 (about 6x Bitcoin’s market cap)

Operates in 157 countries with 756 locations, each its own legal entity (sue that you small individual)

Over 200,000 employees

6th largest privately owned corporation in the US

One of the Big Four auditors, along with Deloitte, EY and KPMG

So what does PwC do?

Basically the main focus is tax evasion for large multinational corporations and audits where they are repeatedly caught looking the other way for the benefit of their 1% clients, and don’t forget to sprinkle in some money laundering for terrorist states. Here is a short list of PwC controversy:

The Luxembourg Leaks A massive financial scandal revealed in November 2014 by the International Consortium of Investigative Journalists. Basically PwC would set up secret tax rulings in Luxembourg for the benefit of their clients (multinational corporations), the scheme was to transfer revenues to Luxembourg to avoid taxes in the countries in which they actually operate. Tax rulings in Luxembourg are strictly confidential, nothing about them is revealed to the public. 548 tax arrangements relating to 343 PwC clients became known after the leak, it is speculated that this is just the tip of the iceberg most still remain a secret.

A massive financial scandal revealed in November 2014 by the International Consortium of Investigative Journalists. Basically PwC would set up secret tax rulings in Luxembourg for the benefit of their clients (multinational corporations), the scheme was to transfer revenues to Luxembourg to avoid taxes in the countries in which they actually operate. Tax rulings in Luxembourg are strictly confidential, nothing about them is revealed to the public. 548 tax arrangements relating to 343 PwC clients became known after the leak, it is speculated that this is just the tip of the iceberg most still remain a secret. Caterpillar PwC received $55 million from Caterpillar Inc. for creating a tax avoidance scheme where $8 billion in profits were shifted from the US to Switzerland which enabled Caterpillar to dodge an estimated $2.4 billion in US taxes over a 10 year period. A PwC partner was quoted as saying “We’ll all be retired when this . . . comes up on audit.”.

PwC received $55 million from Caterpillar Inc. for creating a tax avoidance scheme where $8 billion in profits were shifted from the US to Switzerland which enabled Caterpillar to dodge an estimated $2.4 billion in US taxes over a 10 year period. A PwC partner was quoted as saying “We’ll all be retired when this . . . comes up on audit.”. Willie Nelson Poor Willie lost everything when the IRS decided that the tax shelters set up for him by PwC were disallowed. Willie sued PwC and settled for an undisclosed amount.

Poor Willie lost everything when the IRS decided that the tax shelters set up for him by PwC were disallowed. Willie sued PwC and settled for an undisclosed amount. AIG & Berkshire Hathaway PwC completely failed in its duty as auditor over a 14 year period. According to BusinessWeek PwC “dropped the ball” on something that was “accounting 101” allowing AIG to assume risk on claims beyond what they could afford to pay.

PwC completely failed in its duty as auditor over a 14 year period. According to BusinessWeek PwC “dropped the ball” on something that was “accounting 101” allowing AIG to assume risk on claims beyond what they could afford to pay. ChuoAoyama Fraud PwC’s Japanese affiliate was suspended by the government when three of PwC’s partners were found guilty of accounting fraud to the tune of $1.9 billion after the collapse Kanebo cosmetics.

PwC’s Japanese affiliate was suspended by the government when three of PwC’s partners were found guilty of accounting fraud to the tune of $1.9 billion after the collapse Kanebo cosmetics. Tyco Settlement PwC agreed to pay Tyco $229 million to settle a class action lawsuit over a multi-billion dollar accounting fraud that allowed Tyco’s then CEO and CFO to loot $600 million from the public company.

PwC agreed to pay Tyco $229 million to settle a class action lawsuit over a multi-billion dollar accounting fraud that allowed Tyco’s then CEO and CFO to loot $600 million from the public company. JP Morgan Securities Audit In 2012 PwC was fined 1.4 million pounds for wrongly reporting that JP Morgan Securities had complied with client money rules which protects client funds.

In 2012 PwC was fined 1.4 million pounds for wrongly reporting that JP Morgan Securities had complied with client money rules which protects client funds. Public Company Accounting Oversight Board The PCAOB managed to turn up 40 audits from 2012–13 in which PwC had “significant deficiencies” in their auditing practices. Not oversights, blatant fraud.

The PCAOB managed to turn up 40 audits from 2012–13 in which PwC had “significant deficiencies” in their auditing practices. Not oversights, blatant fraud. Terrorist Money Laundering Yea, really, these guys launder money for terrorist states… In 2014 PwC was slapped with a $25 million fine for helping a Japanese bank launder money for known terrorist states Iran, Sudan and Myanmar. A PwC then director, now partner (yea, promote that guy!) was at the center of the scandal.

So, there is a lot more, and I mean a LOT, (409,000 google results for “PwC scandal”) but I think you get the gist of it….

What could a company like PwC hope to gain from partnering with a small startup that has recently re-branded Bitcoin and taken control of it’s reference implementation?

My guess is more of the same; money laundering and tax evasion for large multinational corporations and occasionally terrorists and drug dealers.

At first blush this might not seem like a bad thing for Bitcoin HODLers, I mean once Greg’s privacy changes (very cool functionality by the way) make it into the client PwC can literally take Bitcoin to the moon overnight hiding it’s clients ill gotten gains in the blockchain.

And yes, if that is the intent we will go to the moon, very quickly.

However, what happens when they get caught? When the public lines up with pitchforks and screams for blood who will take the fall? PwC? Doubt it. Blockstream? Maybe. Bitcoin? I’ll leave that for you to speculate about…