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Using Bitcoin Or Other Cryptocurrency To Commit Crimes? Law Enforcement Is Onto You

Using Bitcoin Or Other Cryptocurrency To Commit Crimes? Law Enforcement Is Onto You

Using Bitcoin Or Other Cryptocurrency To Commit Crimes? Law Enforcement Is Onto You I write and consult on digital transformation in the enterprise. Opinions expressed by Forbes Contributors are their own. Speculative bubble or no, perhaps the greatest challenge facing Bitcoin, cryptocurrencies in general, and the broader world of blockchain is the fact that all of these efforts in some way support criminal endeavors. Ive written about how criminal enterprise is largely responsible for the value of Bitcoin , and to be sure, it drives the demand for many alternative cybercurrencies as well. However, regardless of whether you believe cryptocurrency is all about facilitating crime vs. crime being but a small, unfortunate side effect of the rise of crypto coinage, theres no arguing with the fact that global law enforcement recognizes that cryptocurrency is the criminals playground. In fact, four primary areas of criminal activity lend themselves to cryptocurrency: tax evasion, money laundering, contraband transactions, and extortion not to mention the theft of cryptocurrency itself, which is all too easy with Bitcoin. Cryptocurrencies have actually led to a massive cat and mouse game with law enforcement, as agencies get better at identifying criminal behavior, while criminals come up with new evasion techniques and increasingly anonymous cybercurrencies in order to defeat the efforts of law enforcement. While much of this innovation in the greater cybercurrency/blockchain arena aligns with the interests of criminals, there is another side to this story: the increasing recognition that law enforcement requires its own technological innovation in order to keep up. Steve Garfield, Jrn Eriksson, and Jason Bloomberg Cryptocurrency: Criminal vs. Law Enforcement Cat-and-Mouse Ga Continue reading >>

Bitcoin Is Too Hot For Criminals. They're Using Monero Instead

Bitcoin Is Too Hot For Criminals. They're Using Monero Instead

Bitcoin is too hot for criminals. They're using monero instead by Ivana Kottasov @ivanakottasova January 3, 2018: 12:32 PM ET Bitcoin is becoming too hot for criminals so they're switching to more obscure cryptocurrencies such as monero, according to European law enforcement officials. Just as bitcoin has skyrocketed in value and popularity, so has the attention given to the digital currency by law enforcement agencies, making it a less attractive method of payment in the criminal world. Europe's top law enforcement official -- Europol executive director Rob Wainwright -- tweeted Tuesday that there will be a "progressive shift in 2018 towards criminal use of cryptocurrencies other than bitcoin." That shift makes it "more challenging for law enforcement to counter," he added. Experts say bitcoin is becoming too mainstream, and therefore too risky, for criminals. Related: Bitcoin mania: What the big names of finance are saying "The fact that bitcoin is constantly in the spotlight makes it more valuable for investors, but certainly less valuable for its earliest fans -- criminals -- giving rise to interest in other alternative cryptos designed to avoid tracking," said Daniele Bianchi, assistant professor of finance at Warwick Business School. The number of cases where criminals have been identified through bitcoin tracing is increasing, according to Europol. Companies such as Elliptic and Chainalysis specialize in tracking bitcoin transactions, linking them to companies and individuals, and they work closely with law enforcement agencies. Bitcoin may be challenging to track, but each transaction provides investigators with information that can lead them to the IP addresses of the computers sending and receiving the payment, the amount of bitcoins transferred and a timesta Continue reading >>

Sex, Drugs, And Bitcoin: How Much Illegal Activity Is Financed Through Cryptocurrencies?

Sex, Drugs, And Bitcoin: How Much Illegal Activity Is Financed Through Cryptocurrencies?

University of Technology Sydney (UTS) - Faculty of Business; Stockholm School of Economics, Riga; Financial Research Network (FIRN) Cryptocurrencies are among the largest unregulated markets in the world. We find that approximately one-quarter of bitcoin users and one-half of bitcoin transactions are associated with illegal activity. Around $72 billion of illegal activity per year involves bitcoin, which is close to the scale of the US and European markets for illegal drugs. The illegal share of bitcoin activity declines with mainstream interest in bitcoin and with the emergence of more opaque cryptocurrencies. The techniques developed in this paper have applications in cryptocurrency surveillance. Our findings suggest that cryptocurrencies are transforming the way black markets operate by enabling black e-commerce. Keywords: blockchain, bitcoin, detection controlled estimation, illegal trade Foley, Sean and Karlsen, Jonathan R. and Putni, Tlis J., Sex, Drugs, and Bitcoin: How Much Illegal Activity Is Financed Through Cryptocurrencies? (January 15, 2018). Available at SSRN: or Continue reading >>

Criminals Are Cashing In On Bitcoins For Illegal Activity From Buying Drugs, Hiring Hitmen And Forging Passports On The Dark Web

Criminals Are Cashing In On Bitcoins For Illegal Activity From Buying Drugs, Hiring Hitmen And Forging Passports On The Dark Web

Criminals are cashing in on Bitcoins for illegal activity from buying drugs, hiring hitmen and forging passports on the Dark Web A Sun investigation has now proved that Bitcoin is linked to a range of serious crimes on the Dark Web THE smartly dressed young woman barely attracted a glance as she swept into the second-hand electronics store and approached the Bitcoin machine. Standing there for half an hour, she peeled off 50 notes from a fat roll and fed them into the slot until 10,000 in sterling had been converted into the electronic currency that only exists online. A Sun investigation revealed how criminals are using bitcoins on the Dark Web When she came back the next day to do the same, store manager Simao Arinto became suspicious. It was 50 after 50 after 50, said the boss of the CeX store in central Londons Tottenham Court Road. She told us she got some kind of insurance that paid out for some kind of disease. What was the truth? Who knows? The police, however, believe they do know the truth, warning this week that this fast-growing digital cryptocurrency is being exploited by organised criminals who use Bitcoin cashpoints to launder dirty cash. Bitcoin machines can now be found on the High Streets Bitcoins were being traded for around $20,000 each yesterday as speculators created the biggest buying rush the world markets have ever seen. Some exchanges saw the value of the digital currency 52 percent rise at its peak yesterday with the past seven days seeing a 72 per cent rise. The astronomical price increasesdriven by demand for the coins the numbers of which are limitedare the biggest in the history of modern financial markets, even beating Tulip Mania, a 17th century financial crash that became known as the first financial bubble. Bitcoins price has gone up Continue reading >>

The Dark Side Of Bitcoin: Illegal Activities, Fraud, Andbitcoin

The Dark Side Of Bitcoin: Illegal Activities, Fraud, Andbitcoin

The Dark Side of Bitcoin: Illegal Activities, Fraud, andBitcoin In mid-May, countless people across the world were attacked by a malware program that locked their computers and demanded money to unlock, in an attack dubbed WannaCry. The attackers received thousands of dollars in the form of Bitcoin. Bitcoin is anonymous and easy, which means its a favorite among criminals. Just how is Bitcoin used by criminals, how can you protect yourself from some Bitcoin scammers, and should Bitcoin face higher regulation to prevent criminals from being able to use the cryptocurrency? This article shall delve into the dark side of Bitcoin, and look at some of the negative aspects that present themselves. On May 12 the WannaCry attack started in Europe. Using a malware software that exploited flaws in Windows security that was leaked from the NSA, the malware spread like wildfire, especially on May 15. Soon after the large spread on the 15th, a web researcher was able to drastically slow the attacks by discovering a kill switch. The malware locked a user out of their computer and demanded money payable in Bitcoin in order to unlock. Despite the quickness in slowing the attack, the attackers received thousands of dollars in Bitcoin. The attack sparked renewed media interest in Bitcoin, arguably which helped spark the massive increase in price as I outline in a previous article, but it also caused many to question whether Bitcoin is too easy for criminals to use to receive their ill-gotten gains. An example of this is a strongly worded letter in Financial Times. The author argues that states work hard to limit illegal activity with state backed money, such as the EU outlawing 500 Euro bills, but do nothing to stop Bitcoin. She argues that Bitcoin and other cryptocurrencies have only al Continue reading >>

Bitcoin Price Is So High Because Criminals Are Using It For Illegal Trades, Research Suggests

Bitcoin Price Is So High Because Criminals Are Using It For Illegal Trades, Research Suggests

Bitcoin price is so high because criminals are using it for illegal trades, research suggests If they were to reject it for more privacy-focused digital currencies, its value is 'likely'to fall, according to the study Almost half of all bitcoin transactions are associated with illegal activity, a new study has concluded. Researchers have also linked a quarter of bitcoin users with crime, such as hacks, money laundering and the trading of drugs and illegal pornography. Worryingly for investors, they believe that the sheer popularity of the cryptocurrency amongst criminals is a major contributor to its value. If criminals turn their backs on bitcoin and start embracing more privacy-focused digital currencies, its value is likely tofall, the researchers say. Designed by Pierpaolo Lazzarini from Italian company Jet Capsule. The I.F.O. is fuelled by eight electric engines, which is able to push the flying object to an estimated top speed of about 120mph. A humanoid robot gestures during a demo at a stall in the Indian Machine Tools Expo, IMTEX/Tooltech 2017 held in Bangalore A humanoid robot gestures during a demo at a stall in the Indian Machine Tools Expo, IMTEX/Tooltech 2017 held in Bangalore Engineers test a four-metre-tall humanoid manned robot dubbed Method-2 in a lab of the Hankook Mirae Technology in Gunpo, south of Seoul, South Korea Engineers test a four-metre-tall humanoid manned robot dubbed Method-2 in a lab of the Hankook Mirae Technology in Gunpo, south of Seoul, South Korea The giant human-like robot bears a striking resemblance to the military robots starring in the movie 'Avatar' and is claimed as a world first by its creators from a South Korean robotic company Engineers test a four-metre-tall humanoid manned robot dubbed Method-2 in a lab of the Hankook Continue reading >>

Bitcoin: Crooks Drop Bitcoin For Monero Cryptocurrency | Fortune

Bitcoin: Crooks Drop Bitcoin For Monero Cryptocurrency | Fortune

Bitcoin is the worlds most popular digital currency but, in the crypto community, complaints are growing: Bitcoin takes too long to process transactions, the fees are too high, its expensive, and too volatile . One sign of this discontent is reports that online criminalswho are among bitcoins oldest and most dedicated usersare ditching it in favor of different currencies that offer a better user experience and more privacy. Stories of crooks looking for bitcoin alternatives are not new, but there is an increasing amount of evidence the currency is falling out of favor in the underworld. This includes a new report by the forensic firm Chainalysis that says the proportion of bitcoin transactions related to dark web sites, where people often engage in criminal activities, has fallen from 30% to under 1%. A big part of this drop is because far more people are using bitcoin, and are choosing to hold it rather than spend it. But Chainalysis, which counts many law enforcement agencies among its clients, also cites the growing use on the dark web of other currencies like Monero , Dash, and Zcash . These newer currencies not only offer faster and cheaper transactions, but also include extra layers of anonymity that make them far more difficult to track than bitcoin. Indeed, the Executive Director of Europol, Rob Wainwright, warned this trend is already underway. Well see a progressive shift in 2018 towards criminal use of cryptocurrencies other than Bitcoin, making it generally more challenging for law enforcement to counter, said Wainwright on Twitter . Meanwhile, a detailed report on the topic last week by the tech site ZDNet cited several researchers who claimed that high fees and sluggish transactions times are causing crooks to move to Monero. The phenomenon reportedly ext Continue reading >>

Bitfury Launches New Software To Fight Bitcoin Crime

Bitfury Launches New Software To Fight Bitcoin Crime

Bitfury Launches New Software To Fight Bitcoin Crime Blockchain tech group Bitfury launches Crystal a software stack designed to fight crime that involves Bitcoin. Blockchain tech group Bitfury , founded in 2011 as a Bitcoin mining company, has launched a software stack called Crystal that is designed to help fight crimes involving Bitcoin , according to a press release issued Tuesday, Jan. 30. Crystal will allow users to detect and examine criminal activity that takes place on the Bitcoin Blockchain and avoid interacting with coins that are associated with illegal transactions. Crystals free demo version is available for individuals starting Jan. 30, while a full version for corporate clients will begin shipping in March 2018. According to Bitfury, it took about two years to develop Crystal. The company set out in 2015 with the idea to provide a tool that would help financial and government institutions fight against criminal activity committed with Bitcoin. The industry needs some very user-friendly tools so that you can track bitcoin transactions and see if this bitcoin address that you're getting money from is green or black, said Valery Vavilov, the CEO of Bitfury. Crystals key tool is the so-called detailed risk scoring solution that is capable of tracing suspicious transactions to the final address or withdrawal point. It can also calculate the risk score of any address, which is estimated based on how closely that address is associated with known illegal activities. Other tools include autonomous monitoring of Bitcoin addresses, compilation and sharing of security reports and the REST Application Programming Interface (API) that will allow third-party platforms to build customized solutions on top of Crystals tools. A case of cryptocurrency robbery the first of Continue reading >>

The Law Is Catching Up With Bitcoins Criminal Associations

The Law Is Catching Up With Bitcoins Criminal Associations

The Law is Catching Up with Bitcoins Criminal Associations Bitcoins high praise since 2009 has been popularly met with stiff resistance on the other side of the fence. Several investors, famously including Jamie Dimon, the CEO of JPMorgan, have dismissed the cryptocurrency as worthless for everything apart from criminal activity. While bitcoin does have legitimate uses and has proven so in the many years of its existence, it definitely has a notorious track record. Only this year, a notorious malware dubbed WannaCry made headlines for infecting thousands of computers worldwide. The malware would encrypt all the data on a computer. Users were then greeted with a bitcoin address to which they were asked to send $300 before a particular date. Usually known as cyber-ransom, users would only regain access to their data if they forked over the requested bitcoin. This ransomware attack was made a lot easier entirely because of the pseudonymous and decentralized nature of bitcoin transactions. It is obvious why most contemporary ransomware attacks prefer to use cryptocurrency instead of cash. Bitcoin is also commonly used on the Dark Net , where illegal activities such as human trafficking and drugs run rampant. Law enforcement agencies have been trying to catch up with criminals using the technology and have made notable advancements in that direction. Almost every cryptocurrency uses a public ledger to keep track of transactions in the form of a blockchain which means that anyone can track an amount of bitcoin as it leaves a wallet. The strategy is similar to what governments have already been using to track money since the pre-digital era and has often been phrased as a paper trail. Chainalysis , a company founded in 2014, exists specifically for blockchain analysis. One of Continue reading >>

Why Criminals Can't Hide Behind Bitcoin

Why Criminals Can't Hide Behind Bitcoin

Bitcoin, the Internet currency beloved by computer scientists, libertarians, and criminals, is no longer invulnerable. As recently as 3 years ago, it seemed that anyone could buy or sell anything with Bitcoin and never be tracked, let alone busted if they broke the law. “It’s totally anonymous,” was how one commenter put it in Bitcoin's forums in June 2013. “The FBI does not have a prayer of a chance of finding out who is who.” The Federal Bureau of Investigation (FBI) and other law enforcement begged to differ. Ross Ulbricht, the 31-year-old American who created Silk Road, a Bitcoin market facilitating the sale of $1 billion in illegal drugs, was sentenced to life in prison in February 2015. In March, the assets of 28-year-old Czech national Tomáš Jiříkovský were seized; he’s suspected of laundering $40 million in stolen Bitcoins. Two more fell in September 2015: 33-year-old American Trendon Shavers pleaded guilty to running a $150 million Ponzi scheme—the first Bitcoin securities fraud case—and 30-year-old Frenchman Mark Karpelès was arrested and charged with fraud and embezzlement of $390 million from the now shuttered Bitcoin currency exchange Mt. Gox. The majority of Bitcoin users are law-abiding people motivated by privacy concerns or just curiosity. But Bitcoin’s anonymity is also a powerful tool for financing crime: The virtual money can keep shady transactions secret. The paradox of cryptocurrency is that its associated data create a forensic trail that can suddenly make your entire financial history public information. Get more great content like this delivered right to you! By signing up, you agree to share your email address with the publication. Information provided here is subject to Science's privacy policy. Read more of our specia Continue reading >>

Study Suggests 25 Percent Of Bitcoin Users Are Associated With Illegal Activity

Study Suggests 25 Percent Of Bitcoin Users Are Associated With Illegal Activity

In a newly published paper on the use of bitcoin for illegal activity, researchers from the University of Sydney, the University of Technology Sydney and the Stockholm School of Economics in Riga indicate that a quarter of all bitcoin users are associated with illegal activity. The use of bitcoin for illicit purposes has long been the most controversial aspect of the cryptoasset, although it has taken a back seat to speculation around the bitcoin price over the past few years. In addition to estimating the scale of illegal activity involving bitcoin, the research paper also claims this sort of activity accounts for a significant portion of bitcoins intrinsic, underlying value. In the paper, which was co-authored by Sean Foley, Jonathon R. Karlsen and Tlis J. Putni, publicly available information is used as the basis to identify an initial sample of users involved in illegal activity on the Bitcoin blockchain. Seizures of bitcoin by law enforcement, hot wallets of darknet markets, and Bitcoin addresses on darknet forums are used here, in addition to the trade networks of users who were identified in this data set. Additionally, the researchers use a formula of their own creation to detect users likely to be involved in illegal activity by analyzing the entire public blockchain up until the end of April 2017. The formula for detecting criminals on the blockchain involves a wide variety of metrics such as transaction count, transaction size, frequency of transactions, number of counterparties, the number of darknet markets active at the time, the extent the user goes to conceal their activity and the degree of interest in bitcoin in terms of Google searches at the time. Bitcoin users that are involved in illegal activity differ from other users in several characteristics, Continue reading >>

Criminals Thought Bitcoin Was The Perfect Hiding Place, But They Thought Wrong

Criminals Thought Bitcoin Was The Perfect Hiding Place, But They Thought Wrong

Criminals Thought Bitcoin Was the Perfect Hiding Place, but They Thought Wrong Companies have popped up to help cops identify suspects who use Bitcoin, and savvy criminals are moving to other currencies. A notice to people using Bitcoin for illicit purposes: you can run, but its getting a lot harder to hide. Law enforcement officials are using Bitcoins public ledger, called the blockchain, to follow the digital money and track down suspected criminals using it. As the most popular cryptocurrency, Bitcoin has helped fuel the rise of ransomware attacksextortion schemes, like the recent WannaCry cyberattack , in which hackers hold the contents of a victims computer hostage until they get paid. Criminals can use Bitcoin to collect ransoms easily and without having to reveal their identities. The currency has also been associated with online drug sales, money laundering, and sex trafficking. But while Bitcoin users can withhold their identities, they cant avoid revealing other information that can be useful to investigators. Every Bitcoin transaction is recorded on its blockchain, a publicly accessible record of all transactions made using the currency. Blockchains provide a really useful source of truth, says Jonathan Levin, cofounder of Chainalysis , which develops software tools for analyzing blockchain data. Its products can help investigators draw inferences about how people are using the currency. Chainalysis combines its analysis with other publicly available information to identify users through the unique strings of numbers they use on the blockchain, called addresses, and then map how they move funds around. This technique can be used to do things like identify the Bitcoin exchanges where the users of a gambling site are converting their bitcoins into dollars (see Continue reading >>

Bitcoin Bull Run | Criminal Concerns Still Encourage Some Regulation

Bitcoin Bull Run | Criminal Concerns Still Encourage Some Regulation

Bitcoin Price Bull Run: Concerns Over Criminal Activities Cryptocurrency markets are applauding outcomes from G20 summit; the bulls have extended the bitcoin price above 9K, up more than 22% from Sunday lows. Bulls have been capitalizing on the remarks from Mark Carney and governor of the Central Bank of Argentina who discarded the possibility of imposing bans on cryptocurrencies. Mark Carney said digital currencies only account for 1% of global economic output and they arent threatening the global financial stability. While Mark Carney remarks at the beginning of the G20 summit helped markets recovering from Sunday lows, the concluding comments from Federico Sturzenegger, governor of the Central Bank of Argentina, strengthened bullish sentiments and aided bulls to break the critical resistance levels on price charts. Federico Sturzenegger told press conference : The spirit of the discussion was very productive, and I agree that everybody left very pleased, adding, It was a very good meeting. Tom Lee, who was the strategist at JP Morgan, says he is buying bitcoin, and he expects the price to reach $20,000 in the second half of this year and $25,000 by the end of the year. Though FDS participants didnt criticize cryptocurrencies and rule out new regulations, they asked regulators to take combined steps for regulating digital currencies amid concerns over the illegal use. The reports also suggest that US National Security Agency (NSA) was tracking Bitcoin users across the globe and the segment of the document shows the significant participation of e-currencies in organized crimes, money laundering, and terrorist funding. Also, regulators from all over the world are accepting the involvement of criminal activities; China, India and many others have completely banned digit Continue reading >>

The Criminal Underworld Is Dropping Bitcoin For Another Currency

The Criminal Underworld Is Dropping Bitcoin For Another Currency

Bloomberg the Company & Its Products Bloomberg Anywhere Remote LoginBloomberg Anywhere Login Bloomberg Terminal Demo Request Connecting decision makers to a dynamic network of information, people and ideas, Bloomberg quickly and accurately delivers business and financial information, news and insight around the world. Connecting decision makers to a dynamic network of information, people and ideas, Bloomberg quickly and accurately delivers business and financial information, news and insight around the world. The Criminal Underworld Is Dropping Bitcoin for Another Currency Monero and others lure criminals as bitcoins privacy weakens Some coins post fake blockchain entries to hamper surveillance Bitcoin is losing its luster with some of its earliest and most avid fans -- criminals -- giving rise to a new breed of virtual currency. Privacy coins such as monero, designed to avoid tracking, have climbed faster over the past two months as law enforcers adopt software tools to monitor people using bitcoin. A slew of analytic firms such as Chainalysis are getting better at flagging digital hoards linked to crime or money laundering, alerting exchanges and preventing conversion into traditional cash. The European Unions law-enforcement agency, Europol, raised alarms three months ago, writing in a report that other cryptocurrencies such as monero, ethereum and Zcash are gaining popularity within the digital underground. Online extortionists, who use ransomware to lock victims computers until they fork over a payment, have begun demanding those currencies instead. On Dec. 18 hackers attacked up to 190,000 WordPress sites per hour to get them to produce monero, according to security company Wordfence. For ransomware attacks, monero is now one of the favorites, if not the favorite Continue reading >>

Bitfury Enters Bitcoin Crime-fighting Business

Bitfury Enters Bitcoin Crime-fighting Business

Bitfury Enters Bitcoin Crime-Fighting Business Jan 30, 2018 at 05:01 UTC|UpdatedFeb 2, 2018 at 19:01 UTC Bitfury isn't waiting for law enforcement to clean up the bitcoin space. After years of working with government agencies leery of bitcoin's seedy past, the blockchain services firm best known for its bitcoin transaction processing business has decided to take matters into its own hands. Launched today, a number of tools collectively identified as Crystal are intended to make it easy for users to identify and investigate criminal activity on the world's largest blockchain. But that's not to say that the end goal of Crystal is philanthropic. Developed over a two-year period with feedback from former senior-level government officials, the platform was ultimately created to help bitcoin once and for all move past its association with black market transactions. The next time potential Bitfury customers balk at getting involved with the cryptocurrency, the CEO of Bitfury Group, Valery Vavilov hopes Crystal will provide a solution. "The industry needs some very user-friendly tools so that you can track bitcoin transactions and see if this bitcoin address that you're getting money from is green or black." Beginning today, a free demo license of the Crystal software will be made available to qualified individuals, with pricing for web and enterprise subscriptions to be released in March. The core of the toolkit is a detailed risk scoring solution that helps law enforcement agents and investigators trace suspicious transactions to a final address, or a point of withdrawal. By tracking the relationships between so-called "bad actors," Crystal will generate a score of the likelihood a particular address is related to illegal activity. The results of the data analysis are then p Continue reading >>

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