Bitcoin Conversions! Can They Be Traced?

By Kapil Gauhar

Each time a pirate or criminal convert virtual currency to government issued ones, it makes a vulnerability as indicated by an authority with the US Immigration and Customs Enforcement.

We should think about that from the beginning, Bitcoin and Digital currency were designed with privacy and anonymity in mind. Therefore, these latest findings may happen to some to the individuals who have used Bitcoin unlawfully previously. Is crypto truly as private as we think?

The assistant director of local operations with the Homeland Security Investigation (HSI), Matthew Allen talked about the job of digital currencies in drug amid a hearing held on 3rd October before the US Senate Caucus on International Narcotics Control.

He said in an Allen’s prepared statement –

“On darknet marketplaces and other ‘unindexed’ websites, purchases are often paid for with cryptocurrencies such as Bitcoin and Monero, among many others.”

Allen proceeded to take not of that the HSI is by and large successful in tracing criminals who use cryptocurrencies to launder the profits from drug deals.

Regardless of the ease that comes from exchanging crypto value, Allen said that offenders will still require to convert their crypto into fiat and vice-versa.

“Whatever monetary exchanges are made, a vulnerability is created. This is when criminals are most susceptible to identification by law enforcement by law enforcement means and methods.”

He further added –

“Utilizing traditional investigative methods such as surveillance, undercover operations, and confidential informants, coupled with financial and blockchain analysis, ICE-HSI can disrupt the criminals and dismantle the [transnational criminal organizations], as well as the cryptocurrency exchangers who typically launder proceeds for criminal networks engaged in or supporting darknet marketplaces.”

Allen talked about a few types of crypto exchanges and how they may be used for the wrong reasons including tax evasion. Peer-to-Peer electronic exchanged are especially infamous for this, startups which decline the registration as a money services business.

However, national and universal associations are building up investigators to discover the ideal approach to trace digital currencies such as Bitcoin and Ethereum.

“We train investigators … to deter organizations from laundering proceeds or using cryptocurrencies to fund the purchase of fentanyl/opioids or other narcotics.”