The use of crypto world for carrying out illegal activities has been prevalent since the inception of this game of digital currencies. According to Lilita Infante, a DEA special agent and a member of the Cyber Investigative Task Force at the United States Drug Enforcement Administration, the ratio between legal to illegal activities has shifted a lot as compared to the beginning. But this ratio shift does not imply that the illegal activities have lessened in intensity or have stopped at all.
Five years ago, the cases handled by Lilita at the DEA majorly involved transactions being made in the cryptocurrency world for carrying out criminal activities. As of now, the amount of illegal activities being carried out in the cryptocurrency world have shrunken to an approximate amount of only 10 percent and the dominating factor in the crypto space has majorly been bitcoin speculation.
Despite the pivot shifting towards speculations, no mitigation has been seen regarding the use of cryptocurrencies for carrying out illegal activities. In fact, as compared to 2013, the use of cryptocurrencies for such illegal practices has surged a lot. The major function of the Cyber Investigative Task Force is to focus on dark web and virtual-currency related investigations in collaboration with other game players in this department such as FBI, the Bureau of Alcohol, Firearms, Explosives etc.
In an intervew carried out in her office in Weston, Florida, Infante stated that:
The volume has grown tremendously, the amount of transactions and the dollar value has grown tremendously over the years in criminal activity, but the ratio has decreased. The majority of transactions are used for price speculation.
The popular belief that has been prevalent among the general public is that the use of cryptocurrencies has majorly been to carry out illegal activities. Many criminal activities have been prevalent around this world such as selling and buying drugs using cryptocurrencies, as seen in the case of the notorious Dead Pirate Roberts which provides an online drug bazar used in drug dealing.
The main reason behind the prevalence of these activities is the anonymous nature of the framework deployed at the core of this market. Using blockchain technology and a distributed ledger framework, there is no central node that holds all the information regarding the transactions taking place on the crypto world. Rather the record of all the transactions is distributed among the nodes of the network with no central host. As a result of this distributed network there is no central authority that can be blamed for all the illegal activites or that can be subpoenaed for an investigation.
Another major playground made available by the cryptocurrencies for carrying out illegal activities is the dark web. The platform is used for selling illegal goods and functions on transactions made through cryptocurrencies. It is also used by drug cartels for carrying out banned practices and perform money laundering across borders as it is much secure and cheaper way to do carry out these practices instead of going through the banks.
But with more and more advancements made in the department of law enforcement regarding the crypro world, the platform is becoming easy to identify the transaction patterns for catching criminal sources. Infante is of the view that there are ways to track such activities no matter how anonymous it might seem.
Although money launderers are using the crypto platform and peer-to-peer exchange network to send bitcoins and convert them into fiat currencies, there are still ways to track them as most of them go through major U.S based exchanged.
In conclusion, although blockchain has been the center of all the technological innovations in the recent past, the use of this framework to carry out illegal activities through cryptocurrencies also cannot be denied at all owing to its prevalence on a global scale.