Cryptocurrencies might not be the perfect tool for criminals after all 

Recently, the Department of Justice has successfully recovered $2.3 million in bitcoin that was extorted by hackers from oil refinery giant Colonial Pipeline. 

This success has sent a clear message to the public ー especially to hackers ー that cryptocurrencies are not an ideal tool for criminal activities. And by looking at data from U.S. cyber analysis firm Chainalysis, hackers might have realized the fact much earlier. 

In the analysis, it found that between 2019 and 2020, the use of crypto for criminal activities has gone down by 80%. 

It was a clear indication that hackers have already realized that even with the anonymity that crypto provides, the extorted money can always be pursued by authorities, which was proved in the Colonial Pipeline incident. 

Hunter Horsley, co-founder and chief executive officer for Bitwise Asset Management, said: “I think that criminals are getting smarter that crypto is a pretty poor tool for them, and with Colonial, we saw that in full force.” 

A different story in 2018

In a study made by CipherTrace, a company that combats money laundering, it was revealed that way back in 2018, hackers were able to steal $761 million worth of cryptocurrency from various exchanges. 

But hackers’ confidence has clearly diminished over the years as authorities’ sophistication in bringing back stolen and extorted cryptocurrencies has increased. 

Private key

Pamela Clegg, vice president of Financial Investigations and Education at CipherTrace, said access to a private key makes it possible for the authorities to seize back stolen cryptos. 

But she warned that “seizure of cryptocurrency by direct, physical access to a wallet is not common,” sending a message that crypto-related crimes must still be taken seriously. 

 

Image courtesy of Cointelegraph News/YouTube

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