Crypto money laundering jumps 30% in 2021



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Crypto money laundering jumps 30% in 2021

Cybercriminals had illegally channelled more than a jawdropping $8.6 billion in form of cryptocurrencies or digital assets, which are usually untraceable in plain view without incisive investigations, as crypto money laundering jumps more than 30 per cent last year compared to 2020, blockchain analysis firm Chainalysis reported on Wednesday.

According to Chainalysis, cybercriminals had funnelled over a whopping $33 billion worth of crypto assets since 2017, as centralized and regulated exchanges had missed out a large upsum in FX receipts, underscoring a sense of serpentine insanity that the so-called deFi (Decentralized Finance) could bring about given the opportunities.

Even so, Chainalysis was quoted saying in a report that the latest rise in money laundering activities through deFi or crypto assets in 2021 was not surprising, as several tourism-based economies whose revenue-buckets have bottomed during the pandemic, have legitimated crypt trading and mining with El Salvador reportedly becoming the world’s first nation to legalize crypto tokens.

Though, ethical questions remain on how a large chunk of cash-load that had to be concealed due to its illegitimate source of origins ranging from dark market sales to human trafficking to drug smuggling, could be legalized by transforming them into digital assets.

Crypto money launder climbs as more countries legalize digital tokens

Chainalysis reported that a 17 per cent of $8.6 billion laundered as crypto assets in 2021, had been guided through deFi (Decentralized application) apps, toolkits that control crypto-denominated transactions outside conventional banks, up from only a 2.0 per cent logged in 2020.

Underscoring the extent of difficulty to precisely track the amount of money that has been converted to crypto assets for cross-border transactions, Chainalysis said in a report, “It's more difficult to measure how much fiat currency derived from off-line crime — traditional drug trafficking, for example — is converted into cryptocurrency to be laundered. However, we know anecdotally this is happening”.