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Europol includes privacy-enhancing crypto services as ‘top t...
NEWS

Europol includes privacy-enhancing crypto services as ‘top threats’

Europol recently released its latest Internet Organized Crime Threat Assessment (IOCTA) report. Contained with the 64-page IOCTA report is an assessment that privacy-enhanced wallet services using coinjoin concepts have emerged as a top threat besides well-established centralized mixers.

The report says these services, for example, Wasabi and Samurai wallets, do not fundamentally remove the link between the origin and destination of the funds but certainly make digital currency tracing much more challenging. Some web administrators of underground online markets are trying to apply these wallets to their payment systems.

Privacy-enhancing blockchain service inclusion in this report as a critical finding should not be taken lightly. The IOCTA report is Europol’s flagship strategic assessment, highlighting the dynamic and growing threats from cybercrime.

The emerging use of privacy-enhancing services to evade law enforcement agencies does not come as a surprise to industry followers.

The report says malicious actors have also been “increasingly using hardware wallets” to store funds and private keys securely. It further says that decentralized marketplace protocols are also a “high priority threat,” explicitly naming OpenBazaar, developed by cryptocurrency software company OB1.

Per the report, “Criminals have started to use other privacy-focused, decentralized marketplace platforms, such as OpenBazaar and Particl.io, to sell their illegal goods.”

Anyone can use the OpenBazaar protocol, and there is no intermediary to remove listings before being published. OB1 CEO Brian Hoffman was quoted by CoinDesk saying that his company “actively filtered to remove listings that do not comply with law enforcement and app store requirements.”

While BTC remains the premier payment method for dark web markets, privacy coins such as XMR, ZEC, and DASH are gradually increasing in popularity. “These privacy coins may present a considerable obstacle to law enforcement investigations,” according to the IOCTA report.

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