One of the most significant drawbacks, which is attributed to cryptocurrencies, is the ability to conduct anonymous transactions. As a result, these modern instruments make it possible to carry out such negative activities as terrorism, drug trafficking and the creation of financial pyramids. However, as recent trends show, cryptocurrencies provide more transparency than fiat money.
Last week, the U.S. Financial Crimes Agency (FinCEN) published a report on the involvement of the world's largest banks in the laundering of illegal funds. The leader of this anti-rating was the German Deutsche Bundesbank, through which more than $1 trillion of suspicious transactions over the past 20 years.
It wasn't just Deutsche Bank (DE:DBKGn) that was different. HSBC (NYSE:HSBC), JPMorgan Chase (NYSE:JPM), Bank of New York Mellon (NYSE:BK) and Standard Chartered Bank (LON:STAN) are also among those involved in questionable transactions, with total transactions exceeding $2 billion.
Following the publication of the investigation, the banks reported that checks on these transactions had already been carried out. However, none of them disclosed the details of such and did not report the initiation of criminal cases of money laundering. All banking operations remain under the control of a narrow circle of people, which does not contribute to their transparency.
Unlike the bureaucratic forms of banking, cryptocurrency transactions and smart contracts have a clear hierarchy that allows you to track the entire path of money, as well as seriously reduces the probability of deception in financial transactions.
On September 26, an unknown hacker hacked the KUCOIN cryptocurrency exchange and stole about $150 million of funds from its hot wallets. However, it is not enough to steal cryptocurrency, it still needs to be able to cash. KuCoin management promptly informed other participants of the crypto market about the problem. The digital footprint led to other attacker's wallets that were immediately frozen. In particular, the chief technical officer of Bitfinex and Tether (USDT) Paolo Ardoino announced the blocking of the hacker's wallet with 33 million USDT.
BLOCK explorers allow you to trace the cryptographic trail, and the quick exchange of information does not give the hacker time to maneuver. Some of the stolen ERC-20s surfaced on Uniswap, but the funds were frozen there as well.
Cryptocurrency exchanges every time better reflect hacker attacks, and the inability to cash/launder stolen funds makes this idea unpromising.
btc/usdt
According to the data provided by the StormGain platform, the cryptocurrency market did not react to the hacking. First, users' tools were not affected; and secondly, the cold wallets of the cryptocurrency exchange resisted the attack.
It is safe to say that the more hacker attacks occur, the more effective ways of protection appear in cryptocurrency exchanges, and the community itself becomes more united to solve such problems. Self-regulating organizations like Japan's JVCEA bring together professional participants, form industry safety standards, and corporate channels to quickly share technical information.
Recent events show that the laundering of stolen funds in cryptocurrency can be a task much more difficult than similar transactions with fiat money.
