Are cryptocurrencies truly the ideal tool for money laundering and scams? This question has been a persistent topic of debate among skeptics and critics. However, CoinShares, a leading digital asset management firm, strongly refutes these assumptions. According to their analysis, cryptocurrencies make the global remittance system not only healthier but also more resistant to criminal activities.
Understanding the Real Scale of Crypto-related Crimes
In the unprecedented year of 2022, illicit addresses reportedly received a net cryptocurrency volume of $20 billion. However, CoinShares highlights that the volume of fiat money involved in money laundering could be 40 to 100 times higher. This information is part of their latest research paper, Quantifying Crypto Crime: Expectations vs Data.
The $20 billion figure encompasses potential revenues from a variety of illegal activities, including the sale of child abuse materials, scams, fraud, terrorism financing, and sanctions evasion. This statistic was initially shared by Chainalysis, a top-tier Web3 forensics and security firm.
How Blockchain’s Transparency Deters Crime
Experts at CoinShares emphasize that blockchains, due to their inherent transparency, are not suitable for large-scale illegal operations. The public nature of blockchain transactions is, in fact, one of the major advantages for law enforcement agencies. Companies specializing in blockchain analytics, such as Chainalysis and Elliptic, have aided these agencies in tracing cryptocurrency transactions and identifying criminals who misuse Bitcoin and other cryptocurrencies.
Modern tracking tools can trace the entire history of fund movements following significant scams and hacks. As a result, anyone can track the laundering, exchange, and withdrawal of illicit funds, thereby avoiding interaction with them.
The Miniscule Percentage of Cybercrime Proceeds from Crypto
When it comes to ransomware and cybercrime-related transfers, the picture is similar. While cybercriminals’ net revenue might exceed $6 trillion annually, only $450 million is attributable to cryptocurrency. CoinShares experts pointed out that the total amount of crypto implicated in cybercrimes accounts for a mere 0.55% of Bitcoin’s (BTC) trading volume.
Even cryptocurrency mixers like Tornado Cash can assist in identifying the orchestrators of cybercrimes. For example, Chainalysis was able to recover some funds stolen by North Korean hackers through such services.
As we continue to debunk myths surrounding money laundering and scams in the cryptocurrency world, it’s essential to have the right tools at our disposal. One such tool is cryptoview.io, a comprehensive platform that provides vital insights into the crypto market, helping users make informed decisions.
