Topic: Cryptocurrencies and Financial Crime (Read 304 times)

Kyc shouldn't make anyone stop using BTC because you can use BTC without data farms collecting your data. Recommended self custody and open source wallets don't need your data, and if you want to trade your BTC, you'll have to use decentraized exchanges or use in person trade. It comes with its trade-offs of low liquidy and maybe less 'convenient' for some people, but the advantage of privacy and security outweighs these trade-offs.

Were there not money laundering and financial crimes when cryptocurrencies were not in our lives? Of course there was and the crimes committed in crypto may not be half the crimes committed in the classical order. The biggest feature of Bitcoin different from fiat or traditional money is that it is decentralized. The currency in question is not under the management of any institution or company. This gives users freedom when using Bitcoin. The monetary movements that governments can't track must have bothered them because instead of focusing on the technology and future of cryptocurrencies, they focus on financial crimes. Bitcoin and cryptocurrencies continue on their way stronger than ever in this frustrating process.

It's not Bitcoin's or crypto's fault, fiat is also being used by criminals and on a much larger scale than crypto. There's nothing you can do to prevent it really. I don't think KYC or similar attempts to deanonymize users are necessary as it will likely make many legitimate users stop using it.

The fact of the matter is that Bitcoin and crypto is not protecting of these criminals and their activities, With enough effort and research some crime investigators who worked closely against finding culprits across the internet were able to track some of these criminals who committed crimes in or outside the crypto space, and used the industry under the impression that it would help them keep the police at bay, only to then be caught because the moment that your information is revealed publicly, along with your address, no amount of mixing will steer the authority away from you.

I would argue that it's even harder to commit financial crimes in the crypto space, cause every transaction is recorded, with fiat you could literally go off the grid if you so desire.

Gold and fiat money are also used by criminals, and they are used more than cryptocurrencies, so do you think we should have a solution for gold and fiat?  why is it always bitcoin while the benefits it brings us, you don't mention it?  everything has a downside, and just because criminals use bitcoin doesn't mean bitcoin is all bad.  It is stupid to believe what the government is spreading about bitcoin and not have any research when you create this thread.

Just as with anything that has a good side, there is also the bad side. We know that bitcoin is being used to do a lot of good and we cannot deny that some where on the dark web someone is try to buy drugs, pay for weapons, or other illicit purposes using bitcoins. I think that there is a role that individual like you and me can play in preventing this by reporting to the authorities whenever we notice that such thing is happening there is also the role that corporate organizations that deal with bitcoin can handle this. For example some mixers are used for this purpose. People who are in charge of mixers can have a strong policy against this and report suspicious activity to the authorities and not let them find out themselves because that is when the authorities get the right to label bitcoin bad instead of the act and the people.

I remember reading an article stating that the use of bitcoin for crime and scam activities reduced drastically, but other tokens or altcoins are still top players for scams. Even before the institution of bitcoin, crime happened on the internet, without the internet they'll be no bitcoin or online scam, why is the issue settled on bitcoin as the player? We are well aware that bitcoin is used for transaction purposes, so if a person is not genuine they should be blamed not the means of payment. This bad publicity about bitcoin has reduced the number of investors who have genuine interest on bitcoin. And the bitcoin and financial crime tag won't be removed from people's brain anytime soon.

If the problem is only in crypto, let them come and solve it. But even before crypto, there were reports of money laundering. The problem has never been in crypto.

They usually get mandatory KYC verification from users. Other than that, I don't think there is a way to completely avoid these crypto-related situations. It is also wrong for states to make these regulations against people and exchanges that are only interested in crypto. Some officials think that the money laundering business was born with crypto. This shows that they are not really sincere in their struggle with this situation.

As I said, we are in the age of technology and there is nothing that cannot be followed. There are many precautions they can take if they really don't want such bad things to happen.

Anything that has an advantage also has a disadvantage and illicit activities are part of it so far it involves money, however, the rate of fraudulent cases and money laundering activities that have been committed using fiat currency since its existence cannot be compared with money laundering cases experienced in the cryptocurrencies space.

The blockchain is meant to be traced, it's more of a database of information for the money sent and receive, I'm sure the government can use that information if they see a crime is evident. We are in the digital age already, there is no room for mistakes if the regulation is serious about fighting financial crimes.

When they caught Ross of Silkroad, they also traced a lot of users thru the transactions on the blockchain. But there are more crimes using fiat money than crypto though.

i don't think such activities will be halted even if the government or authorities ban such use of money over fraudulent activities. people will always find a way how to scam others. if someone will stop today, another one will be coming as a replacement.
this is the human nature already. but one can avoid from these scammers by at least doing your due diligence before transacting with them.

We need to take preventative measures against unlawful activity and financial crime involving cryptocurrency because we recognize that this is an undesirable and possibly inevitable byproduct of any new technology.

Transparency in financial dealings is one option that could work. Cryptocurrencies' pseudonymous nature is both a major selling point and a potential security risk. It may be easier to trace illegal activities if they are recorded in an open-source, public ledger of transactions (a more transparent blockchain, so to speak) in which names are kept anonymous but transaction trails are visible.

In addition, it may be essential to implement regulations for bitcoin exchanges. Verifying user identities and reporting questionable transactions should be mandatory on these sites. Possible important function for regulatory technology (RegTech).

However, it is important to remember that, just like with any other currency or technology, criminality will certainly survive in some form despite these efforts. The trick is to limit the damage as much as possible while also making cryptocurrency use as secure and regulated as possible.

Money is always used for illegal works and I think that one cannot stop them to doing so because people are so expert in such activities that they think that government cannot control them. But in my opinion one day these all bad activities will be banned.

Not only bitcoin but fiat which is under the control of government is also used for such activities so we cannot blame bitcoin or fiat but we will blame those individuals who are involved in it. There are advantages as well as disadvantages but we have to keep eyes on both so those individuals who are involved in money laundering and crimes should think that they can also use it as a good asset and earn more as a safe and secure way.

we encourage criminals to use crypto and see for themselves if they can't really be traced. in the past, there are already coins being frozen in the exchanges, and criminals are traced and subpoenaed because they were caught. these are kinds of proof that crypto can help lessen financial crimes instead than make worse. 

its banks who are afraid of crypto because if they use crypto, they will be traced because they are the ones who normally launder money.

This is also describing cash/fiat.

Nothing. It will be lessened dramatically over time when most people that are into it are using it as an asset or store of value. That will come naturally when the majority of the people are into it but just as the usage of cash is done with several illegal uses. Bitcoin will be attached on it for as long as it can.

As far as Bitcoin and other Cryptocurrencies are currencies, nobody can do any to stop that. Whatever happens to the Fiat can also happen to any Cryptocurrency. If a country can not stop money laundering, nobody can stop criminals from using Cryptocurrencies. Who is using Cryptocurrencies for criminal activities is unknown so how do you stop it. Cryptocurrency us not use by few members in a family or compound but the whole world so it will be very difficult to identify those criminals.

If care is not taken, the crime rate in Cryptocurrency will be higher than the Fiat Currency because everyone now is going to the internet and criminals are more in the internet. They use the internet as cover up or umbrella body for criminal activities.

Google FATF travel rule and MICA regulation 2023. There are already plenty measurements in taking place. And not just for cryptos, but fiat money / wealth too.

You on the other hand are spreading misinformation. Washing money trough crypto is harder than you think. It's way more efficient using shell companies and fiat money.

There are plenty of existing regulations, and I don't think we need more of those. I believe that a more reasonable, balanced approach should be put in place. Namely, I find it absurd to demand mandatory KYC from everyone on a crypto exchange, regardless of whether their account has dozens, hundreds, or hundreds of thousands of dollars worth of money. It is important to fight big crime, the sort of activities that result in millions or more of laundered money. These activities should be the primary target, and those moving huge amounts of money should be required to provide a lot of documentation. As for regular users, I think the privacy concerns outweigh the risk of illegal financial activities here. Also, I think the regulations should not focus merely on crypto users and platforms, but should also deal with a big issue of banks laundering billions of dollars. I mean, such cases as Danske Bank are crazy, and all efforts should focus on preventing them.

The blame is only for bitcoin but why? There are several money laundering cases with fiat, and I think the number of money laundering with fiat is much bigger than money laundering with bitcoin. Banks and government want us to believe that bitcoin is the main character for money laundering and crime.

what I mean by fight is, instead of blaming crypto currency as the reason behind the increase on some illegal activities and exploits they should focus on facing those who are the brainboss behind those activities.


This is only applicable when one is making use of custodial system, if not their is no how that an addres will be attached with identity verification, like you have said it's not easy, because scammers are also getting wiser day after they and they have their ways of avoiding those centralized system in other not to get caught, and even though they make use of centralized system those information which they use to open up those customer accounts are others information which was gotten from dark web and those who have the information might not even have anything to do with the scam.

Let us not be too focused on bitcoin or cryptocurrency in general, financial crime has always existed between the financial institutions, governments and some individuals and this has always been the norms, it has been happening and keep repeatedly happening, government cannot control it, why would having financial control be more effective on a decentralized network with thebuse of AML agencies when they aren't done yet with fiat, those using it for illicit activities are less of our concerns as long as we know the best means to stay off their limit from attacking us.


Nothing, we just have to leave it as it is, all you could do is to know how you could safeguard your own asset and get secured, if you're not been vulnerable, they won't attack or scam you successfully, make use of a decentralized wallet and don't expose your personal details.

Thinking about a strategy to prevent bitcoin from being used for illicit purposes is akin to looking for a needle in a sea of water. I'm not saying it's not possible; it's quite doable; I just don't see how it can be done without invading people's privacy, which is the fundamental idea of owning or saving in bitcoin.

Fiat currency, like bitcoin, has long been used for unlawful operations and is still uncontrollable by the government despite having entire control of the money in their possession and knowing every data of the accounts these funds are used for transactions.

Using it for illegal activity will continue, but claiming that it is because it lacks a central authority that it is being used for illicit activity is a false statement that should not be disseminated to the public as such so that they do not have or feel a different opinion about what bitcoin truly is.

No measure can be taken, is that what you want to hear? If people think bitcoin is used to illegal thing then we just have to agree, if bitcoin is really going to serve its purpose, then it will definitely be used for illegal things, bitcoin is a currency and every currency is used for illegal things so bitcoin Will also be used for illegal things, the same way fiat currency is used for illegal things and I don’t know if anybody can stop that, but you know that their are lots of people using bitcoin for legitimate purpose.

Why are you not complaining that fiat currency is used for illegal things, why are you not looking for measures to be taken to stop fiat currency from being used for illegal things, or is fiat currency not not being used for illegal activities?
 

what is important to increase is the moral awareness of everyone who uses Bitcoin and Crypto. although there will still be clashes between those with good morals and those with bad morals. because after all we can't force those who have bad intentions with the use of Crypto. control will not be possible. those who do bad things like scammers will continue to do it until they realize their own mistakes.
actually Bitcoin and Crypto is a good update. it's just that those who are irresponsible use Bitcoin and crypto as a tool to commit crimes. the fault is not Bitcoin or Crypto. but they are wrong in using it.

If the government have not been able to successfully bring to an end the crimes associated with fiats like money laundering, drug smuggling, sex trafficking, illegal arm purchase, kidnapping etc. Why do you expect cryptocurrency like Bitcoin that is borderless with no censorship be able to succeed where a central authority has failed? Sadly, there's nothing that can be done to stop bad actors from using it. Transactions using cryptocurrencies are anonymous and are difficult to trace and that's why they are mostly used to perpetrate evil.

If you talk about cryptocurrency, it's mean you're talking about centralized shitcoins, it's stupid if someone use those centralized coins for crime because they're not anonymous or pseudonymous.

In order to mitigate the risk of crime or fraudulent activity is start from teaching the young generations for not become a bad person. It's all about the personality and character, if all people are good people, no one would do illegal activity.

Fiat existed hundreds of years before bitcoin, and for those hundreds of years, criminals have also used fiat money for their crimes. Why haven't I heard of any solutions to reduce the use of fiat by criminals? Have you ever thought about how without bitcoin, criminals would completely disappear? If so, I also hope bitcoin will go away, and criminals will be gone.

Are you a government person trying to spread FUds about bitcoin? Why don't you think of measures to prevent criminals from using fiat instead of bitcoin? The fiat market is still taking over the majority of our daily transactions as well as criminals.

Usually, cryptocurrencies are traceable through public blockchains, meaning transactions aren't completely anonymous and the individuals involved on them can be reached by authorities through minutious investigation. Therefore, there isn't any advantage for criminals when using Bitcoin or similars on their schemes. Thieves are much safer and have more success chances by using paper money, since it doesn't leave any traces backwards.

To mitigate risks of crypto being used by criminals, intelligence agencies from different countries must be skilled on informatics and cybernetic environment. This way criminals will think twice before using crypto. On the other hand, if the intelligence is amateur and inefficient they may feel encouraged to deal with crypto, without fearing any punishments.

When you say fight, how do you mean? Since the advance of the crypto technology, there have always been reports of many illegal activities operated by individuals who exploit the pseudonymous nature of cryptocurrencies.

Although, many measure have been implemented to try reduce these activities such as the kyc, still I don't think that they can be stopped totally. It can only be regulated through awareness, and educating people about the possibility of such activities.

There is no way to mitigate these risks except the user or criminal in questions opt for a centralized service where they have to give out their personal details to in order to pass KYC checks. That's the thing with decentralized computing systems. No one system have control over other computing systems. As with public blockchains, all transactions are publicly available for anyone to read however, there's no way to link wallets to users unless the user in question explicitly expose themselves.

It's one of the downsides of blockchain and crypto. The good thing right now is there is no service right now that provides on and off fiat ramps without some KYC or AML procedure.

Your concern are real and Digital currency like BTC definitely has been used for money laundering but it does not mean governments has to restrict it. Because money laundering has been done before with fiat currency too. Why they do not ban fiat?

The thing is, transactions are so transparent on block chain and once a wallet is attached or tagged as hacker's or scammer's or frauder's wallet. Anyone could track those wallets activity and authorities could track them back by finding loopholes in the system or by their up address. So that's why it has become hard for the money launderers to launder money using crypto and they are just diverging the interest towards crypto. Because I have also done a little research of all the black money collected in previous years.

That money and hacks are mostly related to north Korea. And we all know that how outside world is disconnected to them and they are to outside world. But we also do know the danger of atomic power they want to acquire and they have the facility to make 40+ bombs but still they are not able to make one. Why? One of the reason is lack of money to buy required facilities. And they are not able to gain money by trading or doing any other activity because they are cut off from the outside world so all they are doing is made some hacking groups who hack different def and other crypto-related projects and that black money goes straight into some account which are being tracked now.

And it has become difficult for them to move the money which is being tracked that's why that money is just lies there in different wallets from many years. That's why I said it become hard for money lay refers to launder money using BTC or any other crypto currency.

• Modify the source code so Bitcoin transactions can only be sent with confirmation of your retina
• Enforce new address generation based on DNA samples
• Only confirm a transaction if the receiver completes a 15-pages long form about the purpose of the transaction

/s

We don't really need anything. I'm quite sure most of the largest hackers and scammers in the crypto sphere have been caught due to not knowing WTF they were doing. Bitcoin ledger's transparency makes it easy for hackers to reveal themselves lol. Our lovely governments have taken the worst measures already. KYC, AML, seizing the wrong money, imposing strict surveillance and control everywhere.. it's happening, and they always say it's the best thing ever against terrorism and other criminal purposes. But guess what? It never works as a tool against crime but as a tool against your privacy.

Stop taking this thing for real, the money you own inside that fiat wallet is so much dirtier than my Bitcoins.

Yes, bitcoin can be used for criminal purposes, but the proportion of this is insignificant compared to cash. All real crimes are committed using cash and the influence of btc is greatly exaggerated in this. Why would an average villain use bitcoin with all the complexities in the form of wallets, transactions and other things that will surely leave traces when you can use cash, the movement of which no one will track and it is impossible to understand who and to whom, as well as what paid for.

You say bitcoin is pseudo-anonymous. OK. But cash is 100% anonymous.

I believe that all this information about the use of cryptocurrencies for criminal purposes is being spread on purpose because banks and governments can't control it. If they wanted to prevent crime, then why didn't they abolish and ban cash, as they are trying to do with btc? Perhaps soon this will happen with the advent of CBDC.

Inaccuracies? No

Why did you only focus on mixers?

Bitcoin is the most traded cryptocurrencies, but that does not mean it is the most used in illicit activities when talking of cryptocurrencies. It was before but as more altcoins come, hackers turned to other the altcoins. If you have been reading more about DeFi and DAO hack, you will know that hackers and scammers are moving away from bitcoin towards altcoins.

According to TRM, bitcoin used in criminal activities is reducing and replaced by altcoins:



https://www.trmlabs.com/illicit-crypto-ecosystem-report-2023

there is nothing that can be done by any party to develop cases of fraud and money laundering in crypto form, unless the government legalizes crypto for all transactions in its country, in contrast to fiat which is regulated by the government,
that's what I'm thinking right now about what you said

I don't think there is anything that can be done to stop crypto currencies from being used for illegal activities. If the banking system, which is controlled, can't control and stop illegal transactions from going on in their bank, then how do you think that can also be possible with Bitcoin, which doesn't have any centralized authority controlling it?
 
The only thing that I see as needing to be done is to fight and try to stop those who are using Bitcoin for illegal activities. If those people can be stopped, then there will be a lesser problem. Bitcoin is not the problem; the people using it for illegal activities are the major problem.

If it's only to mitigate then maybe forcing all platforms that are offering all types of crypto services to get license to operate is one solution. Follow up to that is requiring upfront KYC for all users. Criminals will most likely think twice since their financial activities can be monitored.

Fraud and money laundering? Good luck with that, even big time hackers end up with Bitcoins or assets that they can't sell and they have the option to either return the stolen assets or get trapped with tagged address forever.

You can't steal Bitcoin and escape with it unless it's small amount from normal investors, this days transactions can be tracked and your KYC information can be the shit that leads to your arrest, I hope you aren't trying to look for a way to go fully criminal? Kidding.

It's why the government don't like mixing services, that seems to be the only secured way left that criminals are using to get away with crime on the blockchain these days.

Many inaccuracies.

• Bitcoin is a biggest cryptocurrency and it has biggest trading volume. It is a most favorite cryptocurrency for mixer services. You can find many Bitcoin mixers but very little altcoin mixers.
• You can argue with me but you can look at signature campaigns in Bitcointalk, if they are from mixers, Bitcoin mixers.
• With high volume of Bitcoin, it's more easily to do that with Bitcoin than with altcoins.
• Not all bitcoins or cryptocurrencies used in mixers are for illicit activities like money laundering.

That is what the central bank of many countries do say. That cryptocurrencies help the criminals and make them to easily make transactions which are not traceable. But there are many transactions that involve huge amount of bitcoin that people thought the criminals will not be known, but later known.

After the development of other coins which are altcoins and their swapping, altcoins like USDT on Tron blockchain and privacy coins have become what the criminals are using. Little amount of bitcoin is involved in illicit activities.

Fiat is neither the solution because it has been existing before bitcoin and it is used very well for criminal activities. Fiat is used for money laundering, terrorism financing, ransom payment and used as a means of transaction in online and offline scam. Despite the central banks and many government say crypto helps in online criminal activities, their fiat helps more in criminal activities, both online and offline.

Bitcoin and other cryptocurrencies undoubtedly offer new opportunities for financial transactions. However, they can also be used for purposes of financial crime, such as fraud and money laundering. The absence of central control and the pseudonymous nature of transactions make cryptocurrencies appealing for illicit activities.

What do you think can be done to mitigate the risk of cryptocurrencies being used for criminal purposes? What measures should be taken?