Lilita Infante, an agent of the US Drug Enforcement Administration (DEA) and a member of the Internet Investigation Task Force, found that five years ago, 90% of Bitcoin transactions involved criminal activities; now, this proportion has dropped to about 10%. She said that the blockchain actually provides many tools that can identify and determine the identity of individuals, but instead she hopes that criminals will continue to use cryptocurrency.
When Infante started seeing Bitcoin in DEA cases five years ago, her analysis showed that 90% of Bitcoin transactions involved criminal activities. She said that now, the proportion of illegal activities has dropped to about 10%, and speculation is the main driver of this change.
This does not mean that criminals will stop using Bitcoin. Infante stated that since 2013, the number of transactions related to the illegal use of Bitcoin has increased sharply. In an interview from her office in Weston, Florida, she said:
"Over the years, the volume of illegal transactions has increased substantially, and the amount and actual value of transactions in criminal activities have also increased significantly, but the proportion has declined. Most of the current transactions are used for price speculation."
It is generally believed that Bitcoin is mainly used by criminals such as Dread Pirate Roberts (American drug dealer and darknet underground market operator, arrested in 2013), but Infante's investigation shows that this is not the case. However, the survey also found that the underground market is one of the largest groups that use Bitcoin for payment rather than speculation. Bitcoin transactions are usually carried out anonymously, so it is not easy to trace, and the decentralized ledger eliminates the need for banks and governments, which also means that the relevant departments cannot find the person to be subpoenaed when investigating crimes.
Bitcoin price trend
She said that the dark web that sells illegal goods uses cryptocurrency as a specialized payment medium, which has been so for many years. There has been a growing trend in the past year: criminal organizations such as drug cartels are increasingly using digital currencies in businesses including money laundering and cross-border remittances, because it is more important than conducting related activities through the banking system. Cheaper, faster and more concealed.
However, for criminals, this is a double-edged sword, because law enforcement agencies are also using the characteristics of blockchain technology. Bitcoin and other blockchains are public and immutable, providing a valuable resource for agents to track transactions and the rules of transactions. Although the existence of the wallet address once obscured the user’s identity, Infante said: “It will not be the case in the future.â€
Although users sometimes convert Bitcoin to other cryptocurrencies with lower fees and faster transaction times to transfer funds, the vast majority of transactions are still carried out using Bitcoin. Infante said that privacy-focused cryptocurrencies like Monero and Zcash lack liquidity; although these cryptocurrencies are more anonymous than Bitcoin, "we still have a way to track them."
Infante said that although criminals engaged in drug trafficking and money laundering can exchange bitcoins for legal tender in over-the-counter (OTC) and peer-to-peer (P2P) transactions, they need to conduct such exchanges on major US exchanges.
Infante said that criminals may continue to use cryptocurrency, but this is not a big problem for her.
"Blockchain actually provides us with many tools to identify and determine personal identity. In fact, I hope they will continue to use cryptocurrency."
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