The number of criminals using cryptocurrencies to hide ill-gotten funds is rising. According to Chainalysis’ 2022 Crypto Crime Report, cybercriminals laundered $8.6 billion worth of cryptos in 2021, a 30 percent spike from the previous year. Fortunately, law enforcement agencies are wising up to these activities. Some countries are even turning to blockchain-based technology to outsmart these tech-savvy offenders and crackdown on their operations.
For instance, today, the Spanish police officially announced that it would be utilising funds to deploy blockchain-based crypto-surveillance technologies to tackle the rising drug trafficking in the Strait of Gibraltar. They claim that crypto is being rampantly used to fund drug trades in these waters that connect Spain with Morocco and Gibraltar.
The Spanish force has spent $115,000 on acquiring two blockchain analysis tools to help them identify suspicious transactions. Police officers have said that the increasing use of crypto in funding these illicit activities is making it difficult for them to trace payment routes. This is because cryptocurrencies allow criminals to remain anonymous while transacting.
The Ministry of the Interior has also commented on the matter, saying it firmly believes in constantly upgrading the surveillance tools and the supporting technological systems. Many think this could indicate further expenditure on crypto monitoring systems in the country.
Cryptocurrencies have started catching the attention of law enforcement authorities worldwide. Central banks and governments have been calling out these threats unequivocally for a long time. In February 2022, Pablo Hernandez de Cos – the Governor of the Bank of Spain, emphasised the need for increased monitoring of crypto transactions. One of the concerns he cited at the time was “the risk derived from the possible use of crypto assets for illicit activities, including money laundering.”
Around the same time, the FBI also announced the launch of a new crypto crimes unit. Known as the National Cryptocurrency Enforcement Team (NCET), this new task force will conduct its own blockchain analysis to track and seize assets involved in crypto crimes. According to an official press release, the team would also focus on ransomware, crypto mixers, tumblers and other infrastructure that might allow for “the criminal misuse of cryptocurrencies.”
A month later, during the World Police Summit, the cybercrime unit of the UAE’s Dubai Police also followed suit, announcing that it would harness the capabilities of blockchain technology and Artificial Intelligence (AI) to identify criminal activities.
“Technology is changing the world, and police is part of this change. We are continuously looking at the latest technologies in order to beat crime. Cryptocurrency, sometimes, is used for money laundering and crime, so Dubai Police are monitoring in cooperation with the Ministry of Interior,” said Brigadier Dr. Saleh Al Hamrani, Deputy Director-General of Excellence and Entrepreneurship of Dubai Police.
He added that AI would also help the police force foresee and predict future events and outcomes. “We are going to work on the next generation of AI technology to help predict how and what are the risks we are going to face so that we are ready both internally and externally. Utilising artificial intelligence, blockchain, and the ability to predict will help build a solid ground to make police prepare and also improve response and recovery time,” he went on to explain.