According to Asia Times, the head of Homeland Security Taskforce claimed that there has been an increase in the usage of crypto for money laundering and digital currencies are becoming more prominent among Chinese drug dealing organizations.
In a recent conference, the DEA (Drug Enforcement Administration) stated that transnational criminal organizations are becoming more skilled in exploiting crypto, utilising the currency efficiently in illegal drug trades in Asia to evade the law. However, the amount of money laundered using crypto only takes up a very small fraction of the $2 trillion of annually laundered money. It is speculated that the usage of crypto in illegal trades and money laundering would increase surely if no measures are taken to restrict the market.
Regarding this, the U.S. government has put in efforts to learn more about the blockchain system. The government invested a budget triple the amount compared to before in blockchain analysis, hoping to gain more knowledge on the platform and seek ways to effectively regulate crypto. As reported by Forbes, the government has also become more efficient in detecting abnormal trading features and enforcing Anti-Money Laundering (AML) and Know-Your-Customer (KYC) regulations upon crypto trading platforms.
Despite measures taken to restrict the market, criminals with enough motivations will still seek ways to exploit the digital currency for illegal uses. The advantage that officials have over these criminals is the fact that these organizations would need to exchange these currencies into real cash to actually ‘gain profit’ from their illegal trades.
Therefore, only time will tell whether the government could solve issues related to the exploit of crypto by criminals by utilising their advantages and research on blockchain technology. Crypto developers also play a part in the operation as they have access to all the data of ongoing trades on their blockchain platform, and they should equip themselves with the capability to identify suspicious trades and report them accordingly.
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