DEA sees notable drop in Bitcoin crime

Criminal activity behind Bitcoin transactions has dropped from 90% about five years ago to only 10%, says the DEA.

However, the agent leading the investigation, who is also on a 10-person DEA Cyber Investigative Task Force, says the amount associated with the criminal use of Bitcoin has increased notably since 2013.

“The volume has grown tremendously, the amount of transactions and the dollar value has grown tremendously over the years in criminal activity, but the ratio has decreased,’’ revealed Special Agent Lilita Infante.

“The majority of (Bitcoin) transactions are used for (illegal) price speculation.’’

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Infante also said criminal organisations, including drug cartels, are increasingly using cryptocurrencies to launder their ill-gotten profits and for cross-border money transfers because it is cheaper, faster and more secure than traditional banking systems.

The special agent’s findings suggest that opposite to widespread perception, Bitcoin is no longer mainly used for criminal activity and also that criminals that do use the cryptocurrency do it more so because of its features than its price volatility.

Double-edged sword

The DEA agent explains that for criminals, Bitcoin is a double-edged sword because of its underlying technology, which policing officials use to track transactions and patterns. She also states that previously, wallet addresses made it easy for criminals to remain anonymous, but “not anymore”.

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Infante believes that criminal organisations and individuals will continue using cryptocurrencies as they can easily launder money by purchasing Bitcoin and then exchanging it for fiat currencies in over-the-counter and peer-to-peer to crypto exchanges.

“I actually want them to keep using them,’’ she adds. “The blockchain actually gives us a lot of tools to be able to identify people.”