Global nature of the blockchain ecosystem is adding a layer of complexity in the fight against crypto-related crimes. Against this backdrop, the US Department of Justice (DOJ) is calling for international, federal, state and public-private cooperation to improve the regulation and policing of cryptocurrency activity. The task force says that while it recognizes the breathtaking for human flourishing, citing areas including supply chain transparency and central bank digital currency (CBDC), the technology also plays a role in many of the most significant criminal and national security threats our nation faces. While crime has been expanding beyond national borders for years, blockchain and cryptocurrencies have taken this globalization to another level, allowing parties to conduct transactions and transfers between continents in a matter of minutes. In addition to this, some of the largest crypto exchanges are based overseas and conduct very limited customer due diligence. Finally, the emergence decentralized platforms, peer-to-peer exchangers, and anonymity-enhanced cryptocurrencies is further obscuring financial transactions.
For cryptocurrency to realize its truly transformative potential, national, federal and state governments, as well as stakeholders, must take coordinated active to mitigate harmful uses of the technology. the importance of working with interagency and international partners to enhance an already vigorous enforcement plan, regulatory scheme, and policy framework to thwart the opportunities created by cryptocurrency for criminals, terrorists, and other bad actors. Infamous cryptocurrency trading platform BTC-e was one of the world’s major bitcoin exchanges before the US government seized the website and arrested staff members in 2017. According to the indictment, BTC-e facilitated transactions for cybercriminals worldwide and received criminal proceeds from numerous computer intrusions and hacking incidents, ransomware scams, identity theft schemes, corrupt public officials, and narcotics distribution rings. Crimes implicating the cryptocurrency marketplace itself, such as stealing cryptocurrency from exchanges through hacking or using the promise of cryptocurrency to defraud unwitting investors.