Skip to content

There is a possibility that 2020 will set a new record

June 7, 2020

For a new one Report by the digital asset intelligence company CipherTraceOn June 2, the value of lThe money raised from cryptocurrency crimes in the first five months of the year is the enormous amount of $ 1.4 billionThis makes 2020 a potentially active year when it comes to theft, hacking and fraud related to cryptocurrencies

The report also goes on to say that the total volume of stolen cryptocurrencies by 2020 has the potential to move closer to the established brand in 2019 if things go on so quickly of no more and no less than $ 4,500 millionCriminals seem to be taking advantage of this the current COVID-19 pandemic to attack unsuspecting people Obtained through a variety of phishing campaigns related to cryptocurrencies, ransomware and fraud in the darknet market.

Of the numerous scams registered this year, many have used email campaigns that pretend to be various official groups related to the corona virus. such as the World Health Organization, the Red Cross and disease control and prevention centers: Request payments and donations in the form of cryptocurrencies.

There is a possibility that 2020 will set a new recordThere is a possibility that 2020 will set a new record

See also: Public Service Announcement: Watch Out For Fraudsters Pretending To Be Cointelegraph Journalists

Finally, CipherTrace officials claim that The $ 1,360 million stolen in cryptocurrencies so far this year accounts for 98% of the total (about $ 1,300 million). It can be attributed to fraud and embezzlement rather than hacking and direct theft.

Fraudsters continue to improve their methods.

To better understand where the market appears to be heading in the coming months and years, especially when it comes to cryptocurrency crimes, Cointelegraph spoke to John Jefferies, chief marketing officer and financial analyst at CipherTracein his opinion, however It is almost impossible to predict how crypto theft and fraud trends will develop this yearAt the end of the year, the funds received from criminals may exceed the expectations of the betting report the number of $ 4.5 billion in 2019.

Jefferies elaborated on the topic, saying that this year has made the biggest contribution to crimes across the cryptocurrency was Wotoken’s supposed trillion-dollar Ponzi program, that came from China in the coming months Affected by exit fraud from smaller virtual asset service providers or VASPs who have financial difficultiesand I add:

“Retail investors should beware of companies that use hyperbolic statements and promises of exceptional returns to tempt them to participate. If regulators had asked WoToken to provide detailed investment prospects and audited financial statements, they would not have been able to implement their plan. ” and cheating over 700,000 victims, many VASPs, have dramatically improved their security situation, making it difficult for hackers to steal directly from platforms. “

Pawel Aleksander, co-founder and chief information officer of CoinFirm, a blockchain analytics company, he painted an even darker picture, he told Cointelegraph that based on the research and analysis of his own company, The volume of cryptocurrencies stolen in the first quarter of 2020 could actually be closer to the $ 2 billion mark, Highlight:

“Knowing the amounts related to the various fraud cases that occur together is important. However, the most important aspect is to clarify how they can be resolved and to provide companies with the tools and solutions to do so to do.”

The pandemic has made things worse.

As a result of the current corona virus situation, more and more people are spending more time in front of their computer and smartphone screens. Of course, fraudsters have recognized this fact and They are trying to take advantage of this opportunity by developing novel maneuvers that promise high returns on various crypto-related offers.B. binary options, trust trading, etc. to attract unsuspecting people.

Related: On the Darknet side: The role of cryptocurrencies as an exchange method

Aleksander commented on the question of how companies can better limit the spread of fraud related crypto, despite the fact that Most platforms such as social networks and messaging applications try to be more serious and restrict such shameful systems. There are still many challenges that have not been successfully addressedIn his opinion, a balanced ecosystem is needed, where anti-money laundering procedures can be democratized and users have a voice:

“This can happen when there is a synergy between money laundering prevention (AML), fraud investigation and an open data ecosystem that would never bring financial markets for cryptocurrencies to a level of security previously seen or even thought of for traditional finances.”

In this sense, He believes a triple solution is needed, this means, one based on an AML technology platform This enables institutions to review counterparty risk in blockchain transactions and meet their regulatory obligations. The platform should also be able to facilitate end-to-end investigations in cases where funds are reported to be well as encourage Report suspicious activityAleksander concluded, “If the industry accepts such solutions and processes together, the ability of such scams to succeed but also to take advantage of stolen money will be severely limited.”

Jefferies shares a similar viewpoint, which also believes that banks, VASPs and other money service providers can protect themselves from the bad actors who Use their payment platforms and networks to launder money and carry out other illegal activities by using AML measures effectively.

How do Bitcoin ATMs fit into all of this?

A surprising aspect of the CipherTrace report mentioned above is the “exponential” increase in funds sent from Bitcoin ATMs to high-risk exchanges. based in the United States, instead of low-risk companies like established cryptocurrency exchangesThis has caused experts to believe this BATMs can be at increased risk of being used to launder money, especially given the vast majority of funds that may be sent to jurisdictions from abroad missing AML guidelines and know your customer.

Jefferies gave this part of the reason when he expressed his views on the matter The increasing use of BATM by money launderers, as in the case of Kunal Kalra, is the growing location in the United States, he added.::

“Despite the increasing availability of data protection coins like Monero and Zcash, criminals continue to use Bitcoin as there are numerous ramps from Bitcoin to Fiat. Banks and money service providers need to watch out for high-risk transactions originated in BATM that do not adequately comply with the AML guidelines.”

Bitcoin is cleaner than fiat?

Despite the fact that the cryptocurrency sector continues to be defamed daily by members of the mainstream media who claim it Digital currencies are generally still used by bad actors for bad reasons such as terrorist financing, drug trafficking, etc.Jefferies told Cointelegraph that according to his company’s latest research, lCryptocurrencies are considerably cleaner than their reputation suggests:

“The reality is that the criminal use of Bitcoin and other cryptocurrencies is very low. Less than 0.2% of the funds accepted by the exchanges come directly from criminal sources.”

Related: Criminal Currency Activities: Facts, Fiction, and Context