Crypto and Money Laundering
If you’re anti-crypto you actually have two arguments. One, crypto is valueless, and two, it’s a place for people to launder money. Obviously, crypto is not valueless, but is it the haven for illicit money laundering that television pundits and rivals make it out to be?
There’s a difficult truth for those who wish to portray crypto as a money-laundering paradise.
Opponents have bent over rearwards to try and create a narrative, and large interchange more broadly, have been careless in applying anti-money laundering and transparency agreement.
Recently, a reporter reached out and claimed to have proof that company enabled the laundering of some $2.5 billion between 2017 and 2022. However, it’s clear that this reporter simply doesn’t understand the data nor how blockchain works.
Crypto is a terrible vehicle for laundering money for a few reasons. One, KYC is strict in the industry and it’s simply much easier to open a bank account with fake identification certificate at a small local or regional bank. Two, you simply cannot move large sums of money into crypto without people noticing, and three, it is attributable. Even most so-called “privacy coins” are much more clear and easier to trace than traditional cash.
Unlike cash, which is nearly unfeasible to track, Blockchain has proven to be one of the most powerful tools for law imposition. The immutable, public nature of the blockchain makes crypto a poor choice for money laundering because it permits law enforcement to uncover and trace money laundering far easier than cash agreements.
That said, while the fact remains that the traditional economic system is far more susceptible to money laundering and sanctions-busting than crypto will ever be.
Fighting Order and State-Sponsored Crime
Transactions on the blockchain are unchangeable and fully discoverable. So, unlike laundering of cash through banks, crypto money laundering is not difficult to recognise and disrupt. If an assertion is made of direct subjection to companyit can be established or refuted by the transaction record.
Detractors intentionally conflate “direct” with “indirect” subjection and include deposit data. What does this mean?
For example, imagine a drug dealer walks up to your house and slips a bag of illicit material into your mailbox. You obviously couldn’t have stopped them from depositing the illicit materials, but it’s now binding on you to do the right thing by contacting law imposition and providing them with the info they need to catch the assassin.
Let’s look at some recent claim around Lazarus, a cybercrime group run by the North Korean state.
Many team members were involved in the initial inquiry that led to the identification of the group and the finding of the funds from the $250 million theft from an exchange. The vast majority of funds went to other trade.
Another case involved Eterbase, a Slovakian-based trading that was hacked by Lazurus. While company is unable to comment on its specific correspondence with Slovakia’s national police, we can say that following the claim about Lazarus opening dozens of anonymous accounts on crypto exchanges, we fully collaborate with requests received from Slovak authorities and helped them to identify both accounts at company as well as other exchanges.
North Korean engineer employ sophisticated means to evade conditions at all financial firms. This comprise front companies, high quality forged documents, third-country IP addresses and other means to bypass controls, such as VPNs. However, Company was able to identify and close numerous accounts linked to North Korean engineer.
In summary, North Korea has attempted to use numerous crypto interchange and traditional banks to launder funds for years. Company leads the industry in identifying and neutralizing these engineers. We actively work with numerous Law Enforcement organization to target North Korean campaigns by sharing brainpower, proactively freezing accounts and shutting down their networks before they can successfully get away with stolen funds.