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Alternative Market Briefing

Losses from digital currency crime soar to $4.4bn in the first nine months of 2019, up 150%

Thursday, November 28, 2019

Laxman Pai, Opalesque Asia:

The total volume of cryptocurrency-related fraud and theft resulted in losses worth $4.4 billion in the first nine months of the year, up more than 150% from US$1.7 billion in all of 2018.

However, the Q3 showed the lowest quarterly cryptocurrency thefts and scams in two years said CipherTrace Q3 2019 Cryptocurrency Anti-Money Laundering Report.

In Q3, cybercriminals stole $6.5 million from cryptocurrency exchanges, while insiders bilked cryptocurrency users out of $9 million in exit scams and Ponzi schemes. This total of $15.5 million represents the smallest number of cryptocurrency crimes of any quarter in the past several years.

Out of the 120 analyzed crypto exchanges, 35% have strong Know Your Customer (KYC) standards, 41% have "porous" standards and 24% have weak KYC standards. 32% of the top-120 exchanges trade privacy coins, the study said.

In anticipation of the new Financial Action Task Force (FATF) Anti-Money Laundering (AML) regulations, many cryptocurrency exchanges have preemptively jettisoned their privacy coins; yet, 32% of exchanges, including those determined to have weak KYC, still have privacy coins listed.

Nations that fail to enforce FATF guidelines are often subject to political ostracization, financial sanctions, and are added to a FATF blacklist, which documents countries that it judges "to be non-cooperative in the global fight against money laundering and terrorist financing."

The U.S. has maintained......................

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