The encrypted trims have made their way to the toolbox

CRYPTO-A Thests[1] It is increasingly used in both legal daily activities and illegal activities. In Eastern Europe, especially in Ukraine and Russia, as well as in Latin America, such as Venezuela, the cryptocurrency is increasing because it provides a more stable alternative in difficult economic conditions.

In many Asian and African countries, this is due to the lack of access to traditional financial services for a large number of people. In the global arrangement of virtual currency use, Central and Southern Asia as well as Ocean, with India, Nigeria, Indonesia, the United States and Vietnam at the top.[2]

The Blockchain data platform, estimated at 2024, estimated that a $ 24.2 billion cryptocurrency was transferred to accounts associated with illegal activities in 2023.[3] A year later, the updated estimate was $ 46.1 billion for 2023 and 40.9 billion dollars for 2024.[4]

Crypto is used to enable various crimes as well as washing returns from them. This includes drug crimes, human trafficking, children’s pornography, different types of fraud, misinformation, ransom attacks, and more. Revenue is used to commit new crimes. Given that more than half of the assets that were stolen by infiltrators last year were stolen by North Korean infiltrators[5]We can assume that it also funds the weapons of the mass destruction developed by North Korea, which can end in the hands of Russia for its use in its attack on Ukraine.

However, we must be grateful for the unknown Satoshi Nakamoto, which invented Bitcoin – the first known non -central encrypted currency commensurate with the definition of today to the virtual currency – and brought the cryptocurrency to the masses. Of course, we can only be grateful if we use every method and tool available to harness the benefits provided by the descriptive data associated with this new type of assets of law enforcement authorities. It also requires appropriate work and the ability of criminal procedures elements.

So far, money has been washed through payment channels, whether through credit institutions or payment service providers. If a person is based on a crime and derives property from him, then he deposits these assets in his own account or by a third party and then transferred to the person B, who in turn transferred them to the person C, etc.

We have seen cases where the same money is traded within the same credit institution through nearly 10 different accounts in one day. Often, the same money moves in a similar way through many other banks and countries within a day or a few days.

For law enforcement authorities and financial intelligence units, tracking such funds is difficult. If the criminal, in a perfect scenario, does dozens of transfers or “asset leaks” per day, law enforcement agencies may take days or weeks – sometimes up to months – to decipher every subsequent transaction when dealing with international transport operations. This is due to the slow international cooperation through mutual legal aid requests, which, which we witnessed and heard, have become worse on an annual basis. At some point, it is reached to the extent to tracking the assets because the assets were wrong, or not by mistake, were transferred to a country that does not participate in judicial cooperation.

Often, it does not make a big difference whether the account owner A or B, as accounts are opened under the people or companies registered in their names. Tracking these assets and their recovery is not always impossible; Simply takes some time. However, the time is not the greatest ally of law enforcement in such cases, as the possibility of recovering and seizing money in the end decreases with every moment of passage.

However, virtual currencies are a blessing from a crime detection perspective, where every transaction is recorded in a mass or record that cannot be changed or processed.

Moreover, all blocs are general. Simply connecting to the Internet and checking where the assets have been transferred from, to, and with any amount. This means that there is no longer a need to spend months in obtaining information about the fate of one treatment and step -by -step progress through a chain of transactions. The entire chain of transactions is displayed to law enforcement authorities within a second part.

Technological developments have advanced in the display of these blocs very quickly so that in the “next second”, it is already possible to verify whether someone else uses chains or similar transactions patterns and search for evidence about where these individuals are in the world. Garantex[6]One of the most supportive service providers in the world today is constantly developing new business models, opens new accounts, changes the associated infrastructure and seeks other ways to hide their activities.

Its activities have been detected, and all accounts related to most of the European Union countries – not to mention those outside the European Union – can respond to the request for mutual legal assistance. If the money is used to distinguishing it in the past in the past, then in the virtual currency tools, a mark can be placed on the encryption wallets with signs that send alerts whenever transactions are made with the assets they keep, which indicates that the money has been transferred to a new portfolio.

Yes, law enforcement agencies do not immediately see those behind a full mass or a specific encryption portfolio, but we cannot be completely sure of this even with payment brokers. Moreover, the mass or encrypted mass portfolio behind a person’s identity is not very important, because the main thing is to restrict the use of additional criminal property, seize assets and confiscate them later as a result of court actions. Just as with other currencies, the crime should not be profitable in encryption either. Let them remain people A and B at the beginning of the investigation.

Therefore, law enforcement authorities may actually want to transform crime further into currencies and virtual brokers within this asset category. This would make such crimes easier to discover and track. At the same time, there is still a long way, bearing in mind that $ 24.2 billion has been referred above, offered only 1.2-3 % of the actual size of the criminal activity that is washed annually, taking into account the appreciation of the United Nations Office on Drugs and Crime (UNODC).[7]

However, I hope that the property derived from criminal activity will be transferred outside the Estonian service providers. Otherwise, we deal with all the negative consequences that come with money laundering, related crimes and terrorist financing.[8]

Being towards innovation and open economy, Estonia has taken the risks associated with encrypted currencies without regard to measures to mitigate risk. This also distinguishes the creators themselves, who were focusing on growth, blindly admired the encryption in this way and left the risk management to the background. However, the initial regulation provided the supervisory authorities with very limited legal reasons for rejecting the issuance of permission or to cancel one exist.

The regional principle applies in criminal procedures, but virtual currencies are global action. In the past, the individuals behind the encryption companies were not based in Estonia and could not be held accountable. It is often the same in many countries today.

Therefore, the encrypted currency can help us to arrest criminals and seize their origins if the confiscation tool group is updated, but it is difficult to bear the empowerment factors for money laundering. We can only fight these professional criminals with real deterrent and penalties. It must be imposed fines on legal entities and money laundering, and the assistant in this must be punished under the criminal law. Otherwise, the cryptocurrency will not be useful.

As for the Bitcoin creator, let the law enforcement grant them a “statue” and let us hope that criminal assets will continue to flow into a coined currency in larger quantities, because it makes our job easier!

Author: Matis Mäeker is the head of the Estonian Financial Intelligence Unit (FIU) and the deputy head of the Moneyval Office. Mäker is a member of the Estonian delegation to Moneyval and Heads of Fiu of Egmont Group, and he was also an alternative member of the AUHTORITY Standing Committee in Auhtority. Mäker was the evaluation and references of many mutual assessment reports conducted by Moneyval. During his experience for approximately 10 years in the Estonian Request Authority, Matis Mäeker composed the general guideline of AML/CTF power, internal guidelines and risk -based approach. Participate in writing the book “The Compliance Book: 150 Gold Rases”

This article was published for the first time in the annual book 2024 of the Prosecutor’s Office, the Republic of Estonia (in Estonian) On February 18, 2025, https://aaastaraamat.procuratuur.e

[1] In this article, the terms of encrypted assets, cryptocurrencies, and virtual currency are used synonymous for simplicity.

[2] 2024 geography of cryptocurrency report. Available online: https://go.chainalysis.com/2024-ggraphy-of-cryptocurrency-report.html (January 10, 2025).

[3] The chainalysis 2024 Crypto Crime Report. Available online: https://go.chainalysis.com/crypto-crime-2024.html (January 10, 2025).

[4] Cross Crime Report 2025. Series. Available online: https://go.chainalysis.com/2025-crypto-crime-report.html (4 March 2025).

[5] 2.2 billion dollars stolen from encryption platforms in 2024, but the hacked folders leak towards the end of the year as DPRK slows the activity after July. series. Available online: https://www.chainalysis.com/blog/crypto-hacking-stolen-funds-2025/ (January 10, 2025).

[6] What is gaantex? Available online: https://www.chainalysis.com/blog/hydra-grantex-ofac-sanctions-russia/ (January 10, 2025).

[7] The United Nations Office on Drugs and Crime for Money Laundering. Available online: https://www.unodc.org/unodc/en/monyy-laundering/OVERVIEW.HTML (January 10, 2025).

[8] See, for example, the International Monetary Fund website for information about the damage caused by money laundering (https://www.imf.org/en/topics/financy-integrity/amlcft (January 10, 2025) or https://www.imf.org/en/blogs/articles/2023/12/07/financy-crimes-hurt-economies-and-st-bter-ndrstood-and-curbed (January 10, 2025)).