February 11, 2018 |

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Money Laundering techniques that may have been used:



Mixing different illegal tokens together to make them indistinguishable



Tumbler - This is slicing multiple tokens and then using them for different transactions to make it less noticeable



Gambling – This is an old-fashioned method for money laundering using casinos. Except, the funds are used extensively on online gambling sites.



Titanium. This is the name of a name project by the European Union which aims to investigate the transactions between parallel markets that use cryptocurrency. With a budget of about 5 million Euros, the project aims to unveil the tools that allow users to remain anonymous during transactions on the Darknet. Their ultimate hope is to fight against the criminal networks that are slipping through the cracks.The European police force, Europol, in its annual report, made mentions of the threats imposed by organized crime on the internet. They pointed to the growing number of criminal networks that are using altcoins such as Zcash Monero or the Dash Nicknamed “private currency”, Dash has gained its infamy by using a network of masternodes that are virtual servers, which add a layer of security for users and keeps them anonymous on the Blockchain.Cryptocurrencies like this only help to reinforce the well-known idea in European politics that crypto-currencies do nothing but proliferate financial crime. Moreover, they are also the gateway to money laundering, racketeering and other serious crimes.Now, owning a cryptocurrency portfolio doesn’t require much identification or proof of who you are as a user.Regardless, those who cry wolf about the anonymity of these portfolios often forget the fact that all transactions are made directly between two public portfolios, or at least is the case for Bitcoin . In effect, the Blockchain is a set of servers and registers that can be accessible to all.The $400 million that was recently stolen from Coincheck in January is also in one specific portfolio somewhere, which should be the subject of all investigations. Co-founder of Chainalysis, Jonathan Levin, recently made a statement saying, “You can run, but you can’t hide" Chainalysis is a security company that oversaw investigation the possibilities of money laundering during 2017. And, their conclusions were far from encouraging from criminals who think of cryptocurrency as a playground.Also, in 2017, the Foundation for the Defense of Democracies released a report on the hidden capital that had been transiting through the Bitcoin network between 2013 and 2016.From the report, it showed that less than 1% of Bitcoin’s capital is in the hands of criminal networks. This is a good number, especially when compared to the 2% to 5% that is used for money laundering in the United States. This is 97% versus the 1% of Bitcoin that is circulating illegally. The study also concluded that due to an increase in malware, 15.75% of Bitcoins that a circulating on the Darknet are fakes or have been fraudulently acquired.Wikipedia defines money laundering as the act of hiding or concealing a source of money that was acquired illegally to reinvest it in other illegal activities.Now, with repeated cyber-attacks on exchange sites, ransomware or payments for illicit products or services by means of cryptocurrency are all activities which give a bad name to the world of crypto-finance.Those who possess these “illegal” coins will then be looking for ways to get them off the Darknet and to somehow incorporate them into the traditional economy. According to the Chainalysis study, the cryptocurrencies that were found on the Darknet were centralized and that 75% of these funds were divided between two exchanges: Alphabay and Nucleus Market. For those who remember, back in 2017, Europol had to close their site and ended up seizing massive amounts of the cryptocurrency.Whichever technique is used, each token, due to its encryption key and peer-to-peer nature make transactions safe, but not 100% anonymous when using the Blockchain.Since Bitcoin’s first appearance back in 2008, there have been countless attempts to appropriate it and there are sure to be more in the future.Whatever the technique used, the uniqueness of each token due to its encryption key and the peer-to-peer nature of the transactions make anonymity not complete in the Blockchain.

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