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Crypto crime has tripled year-on-year: Is it all bad luck?
- The rising crime rate is concentrated in the United States, but the United Kingdom and Australia are also facing problems.
- The popularity of ransomware has largely contributed to this growth.
- Criminal groups use privacy-conscious altcoins such as Monero because they lack supervision.
- The actual crime rate may not be accurately reflected in the statistics.
The recent high-profile disillusionment of a multi-million ransomware group in Ukraine is a glimmer of hope; according to a recent study by the data aggregation website Crypto Head, since 2017, cryptocurrency crime has increased by about 300% every year.
Why is crime attracted by cryptocurrency?
Ransomware is the main reason for the soaring crime rate. Due to its anonymity, convenience and lack of supervision by a central management agency, it prefers cryptocurrency to traditional large-scale blackmail methods.
According to Nicholas Weaver, a senior researcher at the University of Berkeley, due to banking and wire transfer regulations, “cryptocurrency is the only tool for ransomware providers.” Therefore, privacy-conscious coins like Monero have become a special feature of hacker organizations. darling.
In addition to ransomware, the ghost of crime has plagued decentralized finance for many years. For example, in 2018, the European Union law enforcement agency Europol found that billions of pounds were laundered through cryptocurrency in Europe alone.
The impact of crypto crime
The actual crime rate may even be higher than the statistics show.
As Crypto Head’s research points out, the novelty of cryptocurrencies means that some victims may not fully understand the crime involved or where to report it. In the United States, the SEC, CFTC, and IRS all “advocate for regulatory control of cryptocurrencies,” but each of them only does so in “certain circumstances,” thereby complicating the issue.
Cryptocurrency crime will have a lasting impact in the coming years.
The head of the Australian Criminal Intelligence Commission, Michael Phelan, said in April that the increased difficulty of tracking illegal cryptocurrency transactions would consume the resources of reporting agencies. Similarly, the Bank of the United Kingdom may soon need to allocate additional funds to make up for potential losses in high-risk crypto assets.
Lorem ipsum dolor sat amet, consectetur adipiscing elit, sed time and vitality, let labor and sadness, do eiusmod for some important things.
on the other hand
- Criminals account for only a small part of the total number of cryptocurrency users.
- Independent companies such as CipherTrace are working hard to track and combat crypto crimes.
- Law enforcement agencies are becoming more adept at fighting digital crime.
- Criminal groups that switch from cash to cryptocurrency are easier to track down.
Despite the rise of ransomware, criminals account for only a small percentage of users. A 2018 report by the Foundation for the Defense of Democracy found that illegal activities accounted for less than 1% of all transactions, and it has been decreasing year by year. A competitive study conducted by Oxford Law in the same year found a much higher percentage of 44% – but only in.
Industry leaders speak up
Many prominent figures in the cryptocurrency field openly oppose its connection with crime.
Earlier this month, Hunter Horsley, CEO of the index fund Bitwise Asset Management, simply stated that “Bitcoin is bad for crime.” The argument “criminals are getting smarter and encryption is a very bad tool for them. .” Horsley pointed to statistics from the cybersecurity company Chainalysis, which shows that cryptocurrency crime has dropped sharply from 2019 to 2020.
Similarly, CipherTrace, a technical analysis company that provides services aimed at combating crypto crimes, has also noticed a sharp decline in the theft of digital assets, replaced by a small boom in fraud. The use of cryptocurrency for criminal activities is increasingly concentrated geographically. CipherTrace identified “more than 72,000 unique Iranian IP addresses”, with Tehran as the center, and these addresses are related to illegal transactions.
The end of the Wild West?
Law enforcement agencies such as the US Department of Justice are becoming more adept at classifying, analyzing, and prosecuting cryptocurrency crimes. At the end of last year, the department released an 80-page report detailing a “cryptocurrency enforcement framework”, focusing on the ability to seize virtual assets and shut down websites.
Cryptocurrency is also increasingly being used to catch criminals instead of helping them.
In 2019, after Mexican law enforcement traced a bitcoin transaction organized by human trafficker Ignacio Santoyo (Ignacio Santoyo), he was tracked down and arrested. The arrest occurred after a law required cryptocurrency trading platforms to report transfers worth more than 56,000 pesos, similar to the requirements of traditional banks.
Unlike the untraceable cash payments commonly used by human trafficking groups, the new law enables Unidad de Inteligencia Financiera (Financial Intelligence Unit) to track Santoyo.
This article is created by Jihad Jan Yilmaz. If you want your article to be published on DailyCoin, please send your submission to hello@dailycoin.com!
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