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From a long time ago, criminals usually used cash and famous luggage to avoid being tracked. With the expansion of the world of digital currencies, these criminals updated their methods and gradually entered the world of the dark web in order not to fall behind the world of technology! Their progress in the blockchain world and the use of untraceable currencies like Monero and Dash was stunning. Although in advanced countries, various organizations control and monitor these currencies and intermediary exchanges, there are still many loopholes for criminals to exploit. In this article, we discuss some of the latest methods of fraud and money laundering, as well as the institutions that supervise them.
When Bitcoin was invented, not even the ghost of Nakamoto could have guessed that his invention would be used in immoral ways. Or maybe one day its untraceable feature, which is a very important feature, will be misused.
In recent years, the existence of cryptocurrencies has been proven in many secret and mysterious projects, such as Silk Road, which became one of the burnt nuts of the dark web space, and everyone noticed the use of digital currencies for money laundering, deceiving investors, etc. became But with the passage of time, many terrorist networks such as Al-Qaeda and ISIS tried to transfer money without any traces with the help of these currencies, which caused more fear to the elders of the digital currency space.
It might be interesting to know that the use of blockchains can be somewhat traceable! In fact, blockchain is an unlimited ledger for recording all transactions of digital currencies, which can record traces of transactions to some extent. But to find this trace, it requires a lot of knowledge and following different patterns. Of course, the existence of this footprint could not stop criminals from using digital currencies and they continue to do so.
One of the most famous crimes in the dark web is stealing digital currency exchanges. Famous exchanges such as Binance have been subjected to massive attacks by hackers, but no major damage has been recorded so far.
Another method of thieves is to use the usual phishing methods, in such a way that they direct the user to a fake portal and steal their wallet information.
Recently, we have all heard about the misuse of digital currencies, but we also see the internal corruption of digital currencies.
According to the blockchain criminology company CipherTrace:
The number of crimes related to digital currencies has increased by 150%. The amount of these frauds has reached more than 4.4 billion dollars, which is three times more than in 2017.
Perhaps the main reason for this 150% increase was the big theft of Plus Token with the promise of investing ten profits for shareholders.
Fraudsters of this project took over 2.5 billion of the victims’ capital and pocketed a lot of money using the exit scam method.
In this conspiracy, with the mysterious death of the managing director of the exchange, who was considered the main key of the exchange, the property of the victims was destroyed.
Another case was the hacking of the Upbit exchange wallet and the theft of 342,000 Ethereum in November 2019.
One of the most dangerous leaked services so far was bestmixer, which had a similar name to Bitmax exchange. This service mostly used digital currencies that seem to be made to be untraceable, such as Monero and Dash, in its activities, and this caused the attention of security institutions.
These cases are just a needle in a haystack, and many scams go unreported due to the small amount of money involved.
Doubling of transactions
The dark web is the invisible part of the internet for the general public. For the first time in recent years, the flow of digital currencies entering the dark web has doubled.
The dark web market share of digital transactions went from 0.04% in 2018 to 0.08% at the end of 2019.
Although the dark web market share of digital currency transactions is very small, doubling this amount indicates greater resistance to legal restrictions.
Fraudsters are more concerned about people’s needs than governments!
Some of these markets use new decentralized infrastructures such as blockchain technology to avoid being blocked by regulators. In dark web markets, privacy coins such as Monero are received and sometimes the use of these coins is mandatory for users.
With increasing measures aimed at expanding legal activities and prohibiting illegal activities, we are seeing more reports of people being arrested in this area every day. However, these measures have not stopped the development of the dark web.
For example, Russia’s largest dark web market is planning to collect around 150 million dollars through a token offering to globalize its activity. As expected, this token itself is illegal under global securities laws.
Various organizations work against these crimes. For example, the Elliptic organization in London, which used to be active in arresting drug smugglers. The main goal of these companies is to fight money laundering and they identify transactions and track people through the exchanges themselves.
ComplyAdvantage is another such organization that is in contact with legislators. The purpose of this organization is to identify crime patterns in the space of digital currencies.
Katherine Haun is one of the prominent personalities in the field of digital currencies. He has a lot of experience in the field of fighting corruptionLaundering in digital currencies. Catherine’s story goes back to 7 years ago. Where he didn’t even know the name of Bitcoin and one of his colleagues asked him to review a digital currency. Catherine believes that governments should also cooperate with anti-money laundering institutions, otherwise it will not be possible to track criminals in this secret space without the help of governments.
Apparently, digital currency crimes, the use of digital currencies for criminal activities, is decreasing.
In recent years, a study was conducted at the University of Oxford, which showed that 44% of Bitcoin activities are criminal in nature, and in 2019, a research by Chinalysis showed that only 1% of these activities are criminal. Although it cannot be summed up with one example, there is still a ray of hope.
For a long time now, criminals have usually used cash and luggage to avoid being tracked. Researchers using data from the United Nations Office on Crime and Narcotics and China Analysis have shown that the money laundered by the dollar is 800 times the amount spent by Bitcoin on the dark web. Is. With the expansion of the world of digital currencies, the laws need fundamental reforms. Although in advanced countries, various organizations control and monitor these currencies and exchanges, there are still many loopholes for criminals to abuse.
