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People with treasures

In a criminal online world, providing anonymity of cryptocurrency is the main means of payment. But at some point, virtual prey must be turned into quite real money. “People with treasures” will help in this.

Finding such is not difficult if you know where to look. You can hire them on HYDRA , the largest marketplace in the darknet (part of the Internet that is not visible to search engines and for access to which special software needs). “They literally leave packs of cash so that you can pick them up,” says Tom Robinson, the chief researcher and co -founder of Elliptic - a group that tracks and analyzes transactions with cryptocurrencies. - They dig money in the ground or hide behind the bush, and you are informed of the coordinates. This is a whole profession. ”

The Russian -speaking Hydra offers many ways in which criminals can “reopen” - for example, exchange bitcoins for gift certificates, prepaid debit cards or vouchers for iTunes .

The opportunity to own cryptocurrencies, without revealing themselves, makes them attractive for criminals, and especially for hackers who penetrate corporate networks and require a ransom for their unlocking. According to the Chainalysis research company, in 2020 at least $ 350 million was paid in the form of ransoms of hackers, such as Darkside (a group that was able to stop the operation of the Colonial Pipeline oil pipelines in May).

At the same time, each operation with cryptocurrency is recorded in the blockchain, leaving a mark for anyone who has the necessary technological knowledge.

Therefore, a number of companies engaged in cryptocolinism appeared. They help law enforcement agencies identify criminal groups, tracking currencies. Among these companies are New York Chainalysis , which at the beginning of the year attracted an investment of $ 100 million, which gave it a cost of $ 2 billion; London Elliptic , which among its investors calls the American bank Wells Fargo ; And Ciphertrace , which is supported by the US government.

Dark exchanges

In total, in 2020, illegal organizations received about $ 5 billion and sent this money to other organizations, according to Chainalysis : this amount is less than 1% of all operations with cryptocurrencies.

At the dawn of the existence of cryptocurrencies, criminals simply transferred them to the cache on leading crypto -rhms. According to Elliptic , in 2011–2019. Such exchanges helped transfer from 60% to 80% of all operations with bitcoins committed by well -known criminals. But by the last year, many cryptocurrencies, fearing the regulators, tightened the norms to combat money laundering ( Aml ) and the requirement of “Know your client” ( KYC ), as a result of which the share of such operations was reduced to 45%.

This forced some criminals to switch to unlicensed exchanges, where the KYC rule usually does not work. Many such exchanges work in countries with soft regulation, where there are no agreements on the issuance of accused of crimes. However, according to Michael Phillips, the director of the claims of Resilience , which is engaged in insurance from cyberrics, usually liquidity on such exchanges is low, which makes it difficult to transfer cryptocurrencies to ordinary ones. “It is necessary to continue to increase the costs for this business model,” he says.

There are other ways. Chainalysis data show that some of the largest cashing operations are helped by brokers working in the over -the -term market, and some of these companies are created exclusively for this purpose. Small amounts can be obtained in more than 11,600 crypto-bank enuments that appeared around the world and are practically not regulated in any way, or in online casinos taking cryptocurrencies.

Cryptocraminalism

Firms involved in cryptocriminalism use the technology that analyzes operations in the blockchain and human intelligence to understand which cryptocurrencies belong to what criminal groups and to make a more complete picture of the criminal ecosystem. Understanding how money moves in it has helped researchers, in particular, to shed light on how hackers rent their carriers for rent to various branches, receiving a share of ransom in case of a successful operation.

In addition, hackers are increasingly paying for cryptocurrency services purchased from other criminals, such as cloud hosting or accounting data of their victims, says Kimberly Grauer, director of the Chainalysis research. This allows researchers to form a more complete picture of a criminal ecosystem. “In such a business model, the need for cashing is less. Therefore, we can see how, after paying the ransom, money is divided and go to different players in this system, ”explains Grauer.

Sleep off the trail

But cybercriminals are increasingly using the methods of the et of traces. For example, in order to break away from the pursuers, they can “jump” between different cryptocurrencies, often very quickly, or use cryptocurrencies with increased confidentiality, such as Monero .

Among the most popular ways to bring down researchers from the trace is to use the third -hand services to mix dirty and clean means before their distribution. In April, the US Department of Justice arrested a person who has citizenship of Russia and Sweden; He ensured the work of a large service to mix cryptocurrencies Bitcoin Fog , through which over the past decade has spent Bitcoins for $ 335 million.

The most preferred tool in 2020, through which 12% of all Bitcoins washed in that year passed, were technically very complex “private wallets” with several built -in anonymization technologies, including the possibility of mixing with pure crypto, according to Elliptic . The dominant player in this area, according to Robinson, is a project with an open code of Wasabi Wallet .

What next?

The authorities “need to upgrade the rules for freezing assets and applying for them” in order to facilitate the seizure of to law enforcement agencies from exchanges, says Tom Kellermann, Director of Cybersecurity Strategy VMWARE and member of the consultative council for investigation of cybercriminals during the Secret Service of the United States.

And exchanges can cooperate with cryptocolistic firms, which on the basis of their data will warn them about suspicious operations.

Earlier, experts have already promoted the idea of conducting black lists of cryptocurrencies, which are known that they are used for criminal operations. For this, the exchanges, analysts and state bodies must openly share information about the results of their investigations, then this could become an analogue of the warning sent through Interpol.

“Perhaps the time has come to reconsider some of these initiatives,” says Camba Walden, assistant to the main legal adviser of the digital crime unit in Microsoft .

Translated by Mikhail Overchenko

Laundry for cryptocurrencies