A recent report from Elliptic highlights a significant surge in cross-chain crypto laundering, with the amount rising from $4.1 billion a year ago to the current $7 billion. The Lazarus group, backed by North Korea’s government, is a major player in this criminal activity, accounting for around 13% ($900 million). Additionally, scams and Ponzi schemes have increased by 243%, and thefts have risen by over 103%.
This spike in crypto laundering has outpaced previous growth predictions, with criminals diversifying their operations beyond Bitcoin. They are now using privacy coins like Monero and stablecoins pegged to fiat currencies like Tether.
Law enforcement actions against ransomware groups have driven more cyber criminals into crypto laundering. Criminals are moving to decentralized cross-chain exchanges that don’t require identification, making it challenging for authorities to track their activities.
The Lazarus group is the most significant player in illicit crypto movement, diversifying across various assets and blockchains, employing techniques like limit orders and derivatives trading.
They have consistently stolen hundreds of millions of dollars annually, with a massive $1.5 billion haul in 2022. Although their pace in 2023 is slower, the group continues to target cryptocurrency companies and developers, aiming to fund their military initiatives and bypass financial sanctions through cryptocurrency.
This crypto laundering plays a vital role in financing North Korea’s regime, including its nuclear weapons program. The Lazarus group’s sophistication is attributed to government support, and the criminals have adapted to evolving law enforcement tactics by moving to privacy coins and illicit exchanges.
In summary, crypto laundering, driven by groups like Lazarus, has grown significantly, posing challenges for law enforcement and raising questions about the need for enhanced regulation in the cryptocurrency space.
Full report can be found here.
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