EU law enforcement has dismantled crypto mixers that crypto laundered ransomware proceeds. With the coordination of Europol, German and Swiss law enforcement, financial networks that abuse Blockchain tech for profit over criminal gain have suffered and continue to be disrupted. With no name disclosed, the dismantled entity operated as a crypto mixer, meaning that it hides the source of funds in a pool, then redistributes the funds to different wallets, thereby breaking the trail to the source of the funds.
Mixers have legitimate pseudo-anonymous uses
Crypto mixers have a right to operate in the crypto economy, as privacy is a use case of crypto; the service could have been legitimized if the funds were not involved in ransomware payment facilitation, darknet market payment facilitation, and fraud payment facilitation.
The dismantled counter of crypto mixers was a combined multidisciplinary Europol, German Federal Criminal Police BKA, and Swiss law enforcement. Search and seizure have been executed. As a result, law enforcement has frozen the crypto wallets attributed to the mixers, and the operating crypto mixers have been detained for further questioning.
While advocates for privacy might defend the use of mixers on the grounds of protecting user confidentiality, a large number of mixers are controlled and used by malignant actors for the purposes of money laundering and the financing of terrorism, making their use a cause for concern for regulators and law enforcement.
Cybersecurity experts have reported that ransomware gangs are notorious for their great demands for payments
Ransomware gangs demand for payments in Bitcoin and other cryptocurrencies, which are then routed through mixers, obscuring the trail of money. This leads to difficulties in tracking and recovering stolen money, lengthening the duration of the investigations, and as a result, emboldening attackers (Cybersecurity Dive).
The disruption of services offered by such mixers is expected to hinder the operation of ransomware for at least a short amount of time.
What happens when cyber criminals are backed into a corner?
These criminal collections may find it difficult to obfuscate large volumes of money without drawing attention to themselves, and will, in turn, be forced to use other laundering alternatives. This, however, may be at the expense of other experts who predict the rise of other mixers to be used for laundering, or the use of defunct decentralized protocols.
The raid shows the growing attempts around the world to try and regulate services involving crypto
Regulating crypto services will also assist in also implementing Anti-Money Laundering (AML) Regulations. In the European Union, there are now also crypto services (trading platforms and custodians) required to do Know Your Customer (KYC) and reporting obligations for suspicious transactions.
Mixers, however, lie outside of these obligations, abusing the legal vacuums. Authorities are now looking to see if there is a need for more legislation to remove or limit the provision of these services. There is a growing trend in the world that is being more active in the regulation of these services, such as the USA.
This message is a Warning to the people who are using cryptocurrencies without the fear of being chased by the law. There are more and more law enforcement units that work with each other to layer blockchain and blockchain analysis to break Ts and Mixers. There are more services being used. The recent events are a reminder that authorities continue to fight cyber crime, and that military services are being used for crime, taking crime too to avoid detection. The focus on fighting cyber crime to the extreme to avoid detection has become a priority. The recent events are a reminder to all to stay vigilant when it comes to online activity.
