Chainalysis tracked cryptocurrency wallets controlled by criminals such as ransomware attackers, malware operators, and scammers and revealed that the $8.6 billion represents a 30% increase in money laundering activity compared to 2020.
Chainalysis added that such an increase is unsurprising given the significant growth of both legitimate and illicit cryptocurrency activity in 2021.
“Overall, cyber criminals have laundered over $33 billion worth of cryptocurrency since 2017, with most of the total overtime moving to centralized exchanges,” the report said.
The report also noted that North Korea-affiliated hackers, in particular, were responsible for $400 million worth of cryptocurrency hacks last year alone.
Evolution Of Criminal Finances
Similarly, a report by Europol, also published on Wednesday, highlighted pseudo-anonymity and decentralisation as major factors providing a favourable environment for criminals.
“It is important to highlight that cryptocurrencies are not anonymous. Every single transaction is logged in the blockchain, which is a ledger of all transactions distributed to all users in the network. Most blockchains are publicly available, making transactions traceable,” the report read.
Europol asserts that virtually all kinds of criminal profits are laundered using cryptocurrencies. with some of the activities ranging from the laundering of proceeds already in digital form, such as the payment of ransoms or criminal infrastructures, to a transformation of huge amounts of cash into virtual assets.
Examples of cryptocurrency usage in money laundering schemes include the purchase of cryptocurrencies by criminal networks using illicit proceeds and the use of cryptocurrencies to transfer funds.
The European Union law enforcement agency indicated that the use of cryptocurrencies in money laundering schemes has been increasing, and many criminal networks relied on cryptocurrencies as a payment medium during the COVID-19 pandemic.