Bitcoins Role in Illicit Finance Plummeted 97% in 2022: TRM Labs Unveils Startling Findings

Jun 28, 2023 12:30 PM

Bitcoin, Blockchain, Crypto, Crypto Regulations, Crypto Scams & Alerts, Cryptocurrency, Financial

New Report Highlights Criminals’ Preference for Cross-Chain Assets over Bitcoin

A recent report by TRM Labs has shed light on the shift in criminals’ preferences for cross-chain assets over Bitcoin for terrorist financing and other illegal activities in 2022. The report reveals a significant decline of 97% in Bitcoin’s use in criminal activities since 2016, with its share falling to less than one-fifth. Here is a breakdown of the key points:

– Bitcoin’s use in terrorist financing rose by 78% in 2022.
– Bitcoin spending accounted for less than 10% of sales on darknet marketplaces, with Russian marketplaces contributing to 80% of the $1.4 billion spent.
– Scammers often promise customers illegal material involving children, taking funds and disappearing.
– Crypto transfers to scam addresses accounted for about two-thirds of all transfers.

Additionally, the report highlights a link between higher crypto usage and territories with higher perceived corruption and weak capital controls. Interestingly, Tether saw a greater increase of 240% in its use for terrorist financing compared to Bitcoin. Assets on the TRON blockchain have replaced a significant portion of Bitcoin’s share in terrorist financing.

In another finding, criminals in Syria are exploring the potential of decentralized exchanges for terrorist financing. The report also mentions instances of money laundering involving ATMs and the establishment of a crypto ATM business using laundered funds.

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Hot Take:

The TRM Labs report provides valuable insights into the changing landscape of criminal activities involving cryptocurrencies. While Bitcoin has seen a significant decline in its use for illegal purposes, criminals are now turning to cross-chain assets and other alternative cryptocurrencies. This highlights the need for increased vigilance and regulation to curb illicit financial activities in the crypto space. Authorities must continue to work closely with the industry to ensure compliance with anti-money laundering standards and prevent the misuse of cryptocurrencies for unlawful activities.

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