New Report Shatters Perception: Bitcoin No Longer Hackers’ Key Choice for Money Laundering

Bitcoin is no longer the favored asset for money laundering among hackers and scammers. According to a recent report by Elliptic, decentralized platforms like cross-chain protocols, decentralized exchanges (DEXs), and cryptocurrency bridges are now the preferred locations for money laundering.

The report reveals that cross-chain platforms have been used to launder $7 billion in illicit or high-risk funds this year until July. In other words, that’s over $36 billion in current Brazilian real exchange rate. Elliptic states that this high value shows that cross-chain crime is accelerating faster than anticipated.

Cross-chain technology enables the connection of different blockchains, and cross-chain crimes refer to the conversion of cryptocurrencies from one asset to another in order to obscure their illicit origin.

The report also suggests that professional money laundering groups and over-the-counter (OTC) cryptocurrency brokers, who process funds from fraud and hacks in North Korea, are systematically involved in cross-chains. These criminals are employing more sophisticated cross-chain methods to conceal their money laundering activities, including trading derivatives and limit orders.

According to Elliptic, sanctioned entities and terrorist organizations now hold over 80 different assets on more than 26 blockchains. The most notable group is Lazarus, a North Korean entity and the largest source of all illicit funds laundered through cross-chains. Additionally, Lazarus is the third-largest source of crimes across blockchains, having laundered over $900 million through cross-chain methods.

Other criminal groups such as ISIS, Hamas, and Hezbollah are also utilizing decentralized exchanges to launder their illicit funds.

The increase in cross-chain crimes can be attributed to several factors, as reported by Elliptic. Firstly, Bitcoin is no longer the only available cryptocurrency. With thousands of other cryptocurrencies in the market, many of them have attractive features for criminals, such as anonymity or stable value (stablecoins). Furthermore, crackdowns on mixers like Tornado Cash have pushed criminals to explore alternative means of money laundering.

Elliptic emphasizes that the rise in cross-chain crimes has significant implications for virtual asset services and law enforcement in detecting, tracing, and mitigating this new era of cryptocurrency-related crimes.

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