Bitwise Management CEO hunter horsley Was on Yahoo Finance Live to talk about why bitcoin is bad for crime.
The technology that bitcoin runs on, the blockchain, is basically a public ledger. Transactions cannot be hidden. No matter where or when the transaction started, there is a digital trail that shows where it went.
This helps to ensure that transactions are not subject to manipulation. Every single move is documented and can be viewed, tracked by anyone. This is what the authorities are using to be able to recover the illegally obtained money.
What role does crypto play in crime?
When asked questions, the CEO pointed to developments in the Colonial Pipeline ransomware attack where the FBI was able to seize and recover some assets. He said that while it was not intuitive to many people, more and more public is learning about it.
Related Reading | Questions pending as FBI recovers Colonial Pipeline ransomware fund
Talking about his Management Fund, which is the largest crypto index fund manager worldwide, he explained that this is a topic that often comes up with the people he works with. Everyone wants to know what role crypto plays in crime and what they should expect in the future. referenced ChainalysisHorsley, an analytical service used by law enforcement, reported that data on the site shows a decline in the use of bitcoin and cryptocurrencies by cybercriminals in ransomware attacks.
For many years, bitcoin has been the main currency used by cybercriminals to accept payments for ransomware attacks. Many companies have fallen victim to these attacks and have had to pay huge amounts of money in crypto for the attacks. one of those companies was recently Colonial Pipeline. He had to pay $4.4 million in bitcoins to the attackers.
A traceable asset is bad for a crime
But the story does not end here. Exchanges require KYC for their customers to enable authorities to trace such bitcoin transactions. Since bitcoin transactions are public, it is a matter of identifying which exchanges the coins are being transferred to for sale and accounts can be frozen. Stolen coins are then recovered from exchanges.
As expected, a currency and/or transaction that can be tracked with such efficiency is not a good tool for crime. Thus leading to the fact that bitcoin is bad for crime.
Related Reading | US recovers millions in bitcoin for Pipeline ransomware
The use of bitcoin in cybercriminal activities is down 80 percent since 2019. Such a significant drop only shows that criminals are beginning to realize that bitcoin is bad for their operations. This is very evident from the fact that the FBI was able to recover $2.3 million out of the $4.4 million paid to the attackers as ransom.
Hunter Horsley said that cyber security is even more important in crypto companies. They are the most targeted for hacks in relation to bitcoin, other cryptocurrencies.
Regarding the security provided by the government in the cryptocurrency space, the CEO believes that the government is doing a good job so far.
“They are equipping themselves with the right equipment and then they are imposing on the bad actors. “
The Justice Department reported last year that they had confiscated millions of dollars in cryptocurrency from terrorist organizations.
Despite the increase in cyber security incidents year on year, the use of cryptocurrencies in crime related activities has decreased.
That means regulators and law enforcement are doing an effective job of making sure they keep the space safe.
Featured image from MarketResearchTelecast, chart from TradingView.com