Bitcoin Forum

We already knew that laundering cryptocurrencies is much harder than everyone thinks so hackers still preferred the old method and this study by SWIFT proved what we have been suspecting all along.

SWIFT: "Identified cases of laundering through cryptocurrencies remain relatively small compared to the volumes of cash laundered through traditional methods."


https://www.zdnet.com/article/money-from-bank-hacks-rarely-gets-laundered-through-cryptocurrencies/

And maybe anti crypto should read this because this is the first argument that they are going to throw at you when you have a good discussions/debates with them. At least in my case, this is their main argument when I got the chance to talk to people here about crypto, specially bitcoin.

Yes, government can track records of the cryptocurrency userd through banks. Banks had always a record in their system to which authority coulr ask for it if necessary.

However, government will usually trace people that has hold position in the government that has also questionable wealth. This can lead to investigate the wealth of that official but of course it will follow a certain protocol like requesting for a certain investigation that could lead inquiry to bank account statement with the owner knowledge.

But most corrupt government official do not hold money in their bank and they use different names or letting it hold for someone close to them.

Hmmm. I don't know about that. I think the only thing that differentiate cryptocurrencies and traditional ways is time. traditional ways are proven to be one of the safest and known ways to launder money for those hackers but that doesn't mean cryptocurrency can't compete. It's only a matter of time before hackers starts migrating to using privacy cryptocurrencies to launder money once it gets more known and developed.

Not an anti-crypto btw lol. Just stating my opinion.

This is for sure. In terms of money laundering, which must be as old as money itself, fiat is expected to dominate. Transparency is more on the side of crypto than fiat, especially cash, so it must be harder to launder through crypto than through fiat.

Not only from bank hacks but in virtually all cases of money laundering, I bet only a very small portion of it goes to crypto, unless the hackers are crypto fans themselves.

Yeah! this is a solid proof with a solid source to tell them that crypto laundering has just some small case compared to the normal money laundering method. Now since we have this solid proof they can no longer tell us that this thing is one of the problem of cryptocurrencies depends if they really wanted to take this as an evidence cause those haters will just find another reasons for not using cryptocurrency. At the end of the day, Money laundering has not been the case for the crypto but the scam attempt are very popular since many people in the world are newbies about this industry and that one could be fixed if they just spare some times to read and study about the preventative measures regarding the scammers.

its total true no such an fool that laundry his money to his own bank :D

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but i think there is some method can use for laundry and stay clean first of all mixing their coin and try to spread to exchange that doesn't require KYC and then withdrdaw it using local or OTC and combine with old fashion money laundry

I'm also under the impression that criminals themselves are not off loading their dirty money to crypto because it's another layer for them to get over with. So it's better to just off their dirty money in their supposedly legal fronts instead of depositing it to exchange wherein there is still a trail if investigators wanted to dig deeper. I still remember one case in our country, wherein the money from bank hacks are being laundered through traditional based casinos.

All the FUDters and anti-crypto preachers must read this and shut up forever. ;D
The best way for a criminal to launder his dirty money is to turn them into cash,not cryptocurrencies.
Usually the main goal of money laundering is to turn the dirty money into cash.Turning them into cryptocurrencies and after that into cash is just another unnecessary layer of the money laundering scheme,which increases the risk for the criminals.
Privacy coins like monero are not a solution,because the criminals will try sell their monero for cash,which isn't that easy.

wrong, the "bitcoin users" should read these things not those who are spreading the FUD (or as you put it the "anti crypto") because the FUDsters already know this very well and they will continue throwing fake claims including this one around at bitcoiners specifically the newcomers to turn them around to the corrupted systems they own/control.

They should really read this case study. All the blame for illegal transactions was blamed on crypto but they ignore this kind of fact.

In terms like this, they are quiet.

It really is ironic, and you're not the only one who gets the same dumbed up response that crypto and BTC allow for much easier access to money laundering. In light of this evidence, I'm certain that if this fact was to be thrown in these people's faces that they still would not consider it and keep to their own derived conspiracy.

In any case, it is great that this information is now available, as this argument can be used on people who still have some common sense left.

Obviously it's hard to do money laundering on fiat to bitcoin, the first step alone, your transacting party would already know where the money is coming and that could be trace easily. Anything that goes online transferred or pass through a regulated platform can be trace by the authorities as they have all the platforms under them required to cooperate with their request or demand.

Money laundering on cash will usually pass through a casino but then authorities are still smart, they can trace it.

Just like the The Bangladesh Bank Heist, the money were trace that the hacker was laundered in a casino and cash were returned.
This was very famous in our country last 2018 IIRC.

about the hacked : https://www.aljazeera.com/programmes/101east/2018/05/hacked-bangladesh-bank-heist-180523070038069.html

Cryptocurrency being used for money laundering seem to be largely a myth perpetrated by crypto sceptics. Especially when it comes to Bitcoin, a public ledger isn't the best way to hide and obfuscate illegal activity.

Yeah, I've a partner working in traditional finance and we get into occassional talks whenever one of these "Bitcoin scandals" pop up -- as they do every now and then.

Then I wait for the inevitable bank scandal to pop up (the latest I recall was Danske Bank in Estonia) and then point out the massive amounts of money laundered... by the very same culprits in suits.

It's all good fun in the end, but I think anyone seriously working in AML sectors know exactly who the bad guys are. And the bad guys are beginning to understand crypto is really, really not the way to go if you want to wash dirty money.

I'd give up on that if I were you. Just continue loving and adopting Bitcoin, or doing whatever, there's almost no sense in arguing with FUDsters and the like. If you were to introduce BTC to a newbie, then maybe use the story, but for haters? Nah. We all just have to accept the fact that when there are lovers of something, there'd also be someone who'd just step up and hate it straight down without an ounce of research done about it.
If its stats, then the link provided by op should be more than enough. Research about this would basically concentrate on past events anyway.

Few things to trace:

- Fiat movements.
- Crypto movements.
- IP addresses.
- KYCs.

I am sure that we reduce our privacy when accept KYC and finish KYC process so hackers do as well. P2P marketplaces or decentralized exchanges *bisq) can be places where hackers try to do their money laundering. Police and government can catch hackers and money laundering from fiat movements and KYC database.

Why KYC is extremely dangerous – and useless (https://bitcointalk.org/index.php?topic=5221497.msg53726647#msg53726647)

This is pretty good news to crypto lovers as it is giving us an advantage as it indicates that crypto can't be laundered easily base on SWIFT report. I don't have a deep knowledge on both banks and crypto works with regards in fighting the hackers but I am a little bit happy knowing that crypto can't be hack easily.

The data from swift makes sense! But beware, when you are comparing fiat related frauds to crypto related frauds. Cryptocurrency is just 11 years old and it has only started gaining momentum few years back. So you are comparing an ice cube to an iceberg!

Fiat currency is used by all 195 sovereign countries while bitcoin is used by an worldwide community which is still super tiny! So while the data makes sense because of fiat's userbase, the comparison doesn't make sense!

It's definitely a point you can raise while arguing with a anti crypto people but it's just doesn't make sense looking at the sheer volume difference due to the different userbase!

Given the existing laws and regulations concerning bank secrecy, it is still a lot easier to launder money through known banking networks than doing it on cryptocurrencies. Imagine you already have cold, hard cash and still converting it to crypto to ‘avoid’ watchful eyes. You have to remember that blockchains are publicly-open for everyone, unless you turn into some privacy coins but even then, you’ll have to convert back to bitcoin or cash, then use an exchange which you probably have KYC on.

Trying to do the long game with crypto is just stupid in money laundering with a few extra steps. Even SWIFT knows it themselves even if they can just defend their networks and accuse cryptos as the greater evil.

Compared to adoption, with cryptocurrency users being on the minority, it is obvious that most money laundered is done through fiat.  Those who argued that cryptocurrency is more widely used than fiat itself does not know anything about cryptocurrency and believe highly sensationalized news about cryptocurrency as way of laundering money without using their logic.  I just ignore stubborn people who thinks cryptocurrency is the main culprit for money launderin and I highly agree with what dothebeats (https://bitcointalk.org/index.php?topic=5274262.msg55157557#msg55157557) stated.

It good swift took their time to study the cases of money laundering happened through Fiat and crypto currency because people usually make a big deal when crypto scam and thats was the major weapon the institutions and some government usually used against crypto whereas the fiat money laundering is even worse than crypto.
@OP, thank you so much for this share.

its laundering not hacking  . crypto may be hard to launder as they say but hacking is still prominent here  .

however hacking can also relate or connect to laundering and i think its easy to launder here because of the anonimity that crypto provide . they can use mixers if they arent sure of their privacy but non crypto transactions are way to centralizefd and easily trackable . they didnt think of that ?

Of course hacked fiats get laundered into cryptos rarely because it is not possible to do in huge volume, most of the money gets laundered in p2p trading platforms that is why hackers targeting cryptos itself to hack so they can hide the traces and can convert into other chains finally they can cash it out into fiat.

BTCBTCBTC I am sure that we reduce our privacy when accept KYC and finish KYC process so hackers do as well. P2P marketplaces or decentralized exchanges *bisq) can be places where hackers try to do their money laundering. Police and government can catch hackers and money laundering from fiat movements and KYC database BTCBTCBTCBTC

Of course. This is the digital world. Hacking is prominent here the same way robberies are prominent in the real one. Whatever is the easiest or most convenient goes first.

Actually, you're wrong about two things:

1. Cryptocurrencies (I'm talking about cryptocurrencies that are not designed to provide anonymity unlike Monero) are not anonymous. They're pseudonymous - it's something I have always got confused until not too long ago. Anonymity = hidden; pseudonymity = something similar to having a nickname. On this forum, you're pseudonymous.

2. Hiding non-crypto transactions can be way easier than hiding a Bitcoin tx. If we decided to meet at some place outside the city and left our phones and any other electronic device (including cars that are traceable) at home (or placed them in some Faraday cages if possible), without any surveillance cameras or suspecting people around we could discuss about literally anything and complete any transaction we'd wish without leaving much of a trace behind. If I was to trace all the times your friends/family handed you some bucks (or you did), do you think I'd be able to? I doubt it.

Well actually that was the reality about the issues being thrown against cryptocurrency that it promotes or could tolerate money laundering activities since it is on a digital manner which is prone to hacks. But on the actual realistic scenario it is on the fiat where most money laundering cases are happening. In fact, there are lots of recorded cases related to fiat money laundering activities from illegal activities that uses traditional method compared to the once that are related into cryptocurrency money laundering.

This study by SWIFT must be known by the people most specially by the government to clear things out on such allegations that using crypto currency could lead to money laundering activities to sprout when at the first place there are more activities like that happening on fiat. This would lessen the fear of people to get in touch with crypto currency for the reason that anti crypto are always throwing the issue of money laundering could be related to crypto usage.

It seems to me that there is no real money laundering in cryptocurrencies. Too transparent transactions and large movements cause unnecessary attention. It is more likely that money in cryptocurrency is divided into small amounts, withdrawn in different places in Fiat and then laundered while in Fiat. This is the most likely scenario. In the cryptocurrency itself, no one will launder, as crazy commissions for withdrawal and it is simply unprofitable.

With compare of bank money laundering, of course they are more familiar on this rather than in cryptocurrency.
 
 
 I kind of agree but hackers not only can hack personal details, they can also inject malwares, etc. However, criminals finds it easy to money launder through banks. Although we can't deny the fact that  digital currencies gives us a better access in financial sustem but governments may used advanced tools to detect this kind of transactions being held by money lauderers.

Money laundry sometimes is really happening in cryptocurrencies but, as far as I know the governments can track the cryptocurrency transactions in some special and important cases. However, people will usually use some methods such as mixers to keep the money safe from getting tracked. money laundry is one dark side of the cryptocurrency but in the other hand, the transparency side of it is much more shining than fiat currencies.

Digital money or digital currency is vulnerable when it comes money laundering could be because of security and it doesn't have a physical form. In my opinion, the banking system is already used in a lot of countries that are supported by the government that is I think why a lot of people are using fiat money and banks compared to the cryptocurrency that's a lot of countries dod not support at this time. For me, we can't deny that cryptocurrency is still vulnerable at this point because it is not supported yet but the authorities and its difficult to track illegal transactions.

Thinking that people who hack bank accounts will use crypto to "launder" the stolen funds is absolutely ridiculous. What did they do before crypto? They can still do that exact same thing they have always done. Crypto just allows you to buy and trade something else that has value and anything that has value can be used to launder money. People who steal money don't exactly spend it directly.

The amount of money hacked is huge, and it is difficult for them to launder money through cryptocurrencies quickly because blockchain technology is traceable and market liquidity is very small.
Above all criminals always have clues to conduct money laundering and they will choose the old route.

The entirety of the entire crypto market cap is less than the value of the fake accounts that Wells Fargo opened up without consent from its customer base in just CA alone. Kamala gave them a small slap on the hand a stern finger wag, I'm sure no bank will do anything unethical like that ever again.  ;D

But something about some guy buying marijuana with the bitcoins...

Thank you for sharing the article that proves that money laundering happens a lot through fiat, and the amount is still very rare
for money laundering through cryptocurrency. So the accusations of Bitcoin haters have been answered, it turns out that fiat is
more widely used for money laundering than cryptocurrency. But I believe Bitcoin haters are always looking for other ways to bring
down cryptocurrency.

It doesn't need a show of any evidence or proofs that cryptocurrencies are rarely used for money laundering because we all know that Banks shine there. We have offshore and other things that give us the possibility to do illegal things legally and governments give us that possibility but that's not available for everyone, more likely for rich and elite people are the ones who launder money. See how much money was laundered via Deutsche Bank and by others. It's all just a blaff. Elite people launder money via banks. Cryptocurrencies are just available for everyone and these "elite" people try to ruin the reputation of cryptocurrencies by saying that they are bad, scam, etc. It's like imagine when billionaire was telling to a poor guy during pandemic to stay at home for months.

Russians have two great verbs:
1. Laws are written for stupids!
2. Laws are written to violate!

People hostility towards crypto don't know and don't want to understand that cryptocurrencies can be used for something except money laundering and paying for drugs and weapons. It's hard to make them change their mind.

That has slowly change, maybe in the early stage people are thinking like that but as the adoption increases, more and more people are already knowledgeable about bitcoin and understands its risk. Do you think government would regulate it if it has not bigger positive impact to people, no, they would just ban it and will declare illegal using it, what I'm seeing now is already an improvement, i hope people sees the same way.

Honestly very few governments other than totalitarian regimes actually care about improving society. China, for example, does horrible things to some of its citizens but the net effect is China as a whole becomes stronger (at least in their eyes). The only reason the US now embraces some crypto is they are finally able to start taxing a large portion of the user base. Once government can take their cut they're all to willing to let it bloom. The US government could care less about improving people's access to money because the banks have such a stranglehold over the politicians.

Only those newbies has this thinking because this has been an issue for many years and like everything says,even before Bitcoin comes there are already issues like this that involves Fiat and other Online payments so whats the matter if bitcoin or cryptocurrencies are being on this usage ?when evern without crypto this criminals and syndicates will still exist and continue their illegal activities so better think about those before throwing words in this community.

It is actually not surprising to hear that dirty money are not being widely laundered through cryptocurrencies which have to be transparent in order to stay auditable and verifiable. Dollars are used for money laundering, because no one is able to ever estimate its total supply. Jokes aside, it is not because of that, at least it is just one of the possible reasons why it is used. Criminals, drug dealers, money launderers, they all tend to use the most effective tools to commit their crimes. They have no room for error, that is why they prefer anonymous cash over transparent bitcoin. That is why they prefer traditional banks over transparent and open blockchain. Banks are ruled by greedy people seeking for additional fees while bitcoin is ruled by neutral code, which cannot be bribed by criminals.

I'd rather believe the only reason the US government started supporting crypto is that they found a way to trace and identify citizens using them in order to monitor the legality of their holdings. If blockchain analysis wasn't a thing, they would've pushed back other cryptos as well - but it actually becomes an advantage for them. Some people get into BTC wrongfully believing they're going off the grid, and that's a perfect catch for authorities.

Firstly it will silly for any hacker to launder the money stole from through cryptocurrencies when he can easily laundry the fund by cash and board a secret private jet and save the fund in one the powerful secret global bank in Swiss etc.

On the contrary. The reason why the supported is the high level of tax they are getting from crypto which is one of thing they needed they needed the most for the betterment of their citizens and even thats the reason theres no way they identify the holding of their citizen which use the combination of privacy wallet and Bitcoin tumbler.

I think that there are no exact numbers of money laundering through cryptocurrencies. It's not easy to trace all such transactions and proof they are connected with money laundering. This is much easier with fiat currency although I think such problem exists and that is why crypto still has bad reputation.

Probably before this migration happens all exchanges will turn to KYC.

You can hide your crypto but can you really withdraw big money without being thoroughly screened by both your exchange and the bank that receives the withdrawal?

The best and the most anonymous money is cash. Cryptocurrencies leave an obscure trail but there still is one. Cash doesn't leave any unless you're caugt stealing it.

You have much to learn about the real world haha. Banks are the biggest crooks and big organizations too, they claim to be transparent and do their audits every year with big companies but still hide a lot of dirty money in the books.

Dollars are used for laundering not really because of supply but because it's fungible and it fits into the banking system so well.

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Your statement is not the opposite of what I said, most of money laundering cases are occurring within traditional channels. This situation is not going to change in foreseeable future. However, I disagree with your claim that cash is more fungible than bitcoin. Both physical cash and bitcoin are fungible, otherwise they wouldn't be considered money whatsoever. Fungibility of bitcoin is more natural than that of cash, because it is guaranteed by immutable code. It is rarely used in money laundering not because of non-fungibility, but because of higher traceability and immutability. Money launderers and criminals don't want their illicit transactions to be written on blockchain. Instead, they strive to leave as little evidence as possible. Banks allow for that, bitcoin doesn't.

The reason is simple because this forum is about cryptocurrency so the concern of discussion is money laundering using cryptocurrency, secondly because cryptocurrency has become a trend lately so that it received more attention and the last, money laundering with other currencies has often been detected by law enforcement agencies, but it is not explained in technical detail for the purpose of investigation, so the references of discussion are limited.


Every criminal act, which get additional/margin/benefit is automatically acquired is money laundering. In money laundering, the perpetrator usually places the proceeds of crime into the financial system or changes its form, including being stored in a bank, being smuggled into other countries until it is converted into other assets such as gold or property. Then the proceeds from the crime were transferred, distributed and disguised with the aim of hiding their origins so that they would be difficult to trace. The latter is a combination of proceeds of crime that already appear legitimate to be enjoyed directly or invested in legitimate business activities.

Indeed, bitcoin or cryptocurrency can be used as a new tool for money laundering, but the numbers are smaller because not all criminals want to access this method, many prefer conventional methods that are felt and are proven safe. In addition, criminals will definitely hide their crimes and feel ashamed of social sanctions so they tend to be reluctant to seek information. In addition, in the downstream sector, criminals will face KYC when exchanging their money into exchangers so that the potential for asset loss is still very large.

The complexity of money laundering through cryptocurrency is that there is no convenient gateway through which one could anonymously transfer fiat into cryptocurrency, this is the main obstacle.
Therefore, fiat has its own methods of laundering, while cryptocurrencies have their own. Stolen cryptocurrency is very easily laundered through mixers or regular exchanges if the theft was not tracked down.

Probably because the use of cash is more common the Bitcoin that's why it has more money laundering issue aside from the reason that cryptocurrency is more complex.

I agree with the op that we can use this as an argument but I think the reason why others think that cryptocurrency is more prone to money laundering is because of misconception. They probably often see news about money laundering that involves crypto that's why they think that it's always cryptocurrency though it's not.

What's been said in the opening post is the truth about money laundering. According to several data it is clear that usage of USD on money laundering is much more higher than that of the usage of cryptocurrencies on money laundering. The same is with the illegal activities and drug market.

Governments how the control over the Fiat. But they weren't able to keep track of the money flow on illegal needs and other laundering related activities. To be on the safe side, government always indicate cryptocurrency as the root cause for all sort of illegal activities and money laundering.

Most of the time with the support of banking network money laundering is done with ease. There are few banks that are particularly mentioned as hawala banks.

That's quite appropriate because cash cannot be easily tracked and though it is a risky job to launder money through cash, once done there's no tracing back to it unlike cryptocurrencies where everything can be traced back to you.Though there are alternate methods to use so that the tracing becomes very difficult it still proves that the traditional method can launder money easily.
This might be true because money launderers can use fiat money anywhere they want but there are only a limited options available if you hold large amount of crypto.
It will take a while before we can withdraw a huge amount from crypto to fiat since banks keep tracking large amounts.