Breaking: Europol’s Multi-Million Dollar Bust Exposes Dark Web’s Biggest Cryptocurrency Laundering Service Washed Out with $2.88B Allegedly Illegally Obtained

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The dawn of cryptocurrency has brought about a new era of financial freedom and decentralization, but it has also provided a new playground for criminals to launder their ill-gotten gains. Aware of this vulnerability, Europol has recently made a major breakthrough in the fight against money laundering on the dark web, seizing roughly $46 million in cryptocurrency from one of the largest cryptocurrency laundering services.

Unraveling One Of The Web’s Biggest Laundromats

The German and US authorities, in conjunction with Europol, conducted a joint investigation into ChipMixer, an infamous cryptocurrency mixer within the cybercriminal sector. The operation was supported by authorities from Belgium, Poland, and Switzerland. 

On March 15th, the platform’s infrastructure was taken down as it was suspected to be involved in money laundering activities. This resulted in the confiscation of four servers, 1909.4 Bitcoins from 55 transactions (totaling around EUR 44.2 million) and 7 TB of data.

ChipMixer, an unregulated crypto mixer, was created in mid-2017 and was known for its ability to block the blockchain trail of funds, making it simpler to launder illegally acquired money such as drug trafficking, weapons trafficking, ransomware attacks, and payment card fraud.

The funds were converted into “chips”, which were tokens with the equivalent value. These chips were then mixed together, effectively masking all trails back to the original source.

Record-breaking EUR 2.73 Billion in Illicit Funds Laundered through Ingenious “Chip” Method

Following the investigation, it was revealed that the platform may have been involved in laundering around 152,000 Bitcoins, amounting to around EUR 2.73 billion. It is assumed that these funds were linked to illegal activities such as the sale of banned goods on dark web markets, ransomware attacks, procurement of child sexual exploitation material, and stolen crypto assets. The Hydra Market dark web platform raid lead to the discovery of millions of euros worth of transactions.

ChipMixer was also utilized by ransomware groups such as Zeppelin, SunCrypt, Mamba, Dharma, and Lockbit to launder ransom payments. Additionally, authorities are presently investigating whether some of the cryptocurrency assets that were stolen after the bankruptcy of a major crypto exchange in 2022 were laundered through the same service.

The coordination of the operation was facilitated by Europol, which acted as the go-between for national authorities. Europol also provided analytical support, linking available data to various criminal cases both within and outside the EU. Furthermore, the investigation was aided by operational analysis, cryptocurrency tracing, and forensic analysis, which were also provided by Europol.

The Joint Cybercrime Action Taskforce (J-CAT) at Europol also provided support for the operation. This task force is a standing operational team that consists of cybercrime liaison officers from various countries who work on high-profile cybercrime investigations.

The rise of money laundering on the dark web with cryptocurrencies is a major challenge for law enforcement agencies all over the globe. The lack of transparency and decentralization of cryptocurrencies makes it difficult for them to trace and prosecute criminals, and the use of cryptocurrency mixers and tumblers only makes the situation worse.

Nevertheless, some steps can be taken to counter this problem. Law enforcement agencies can work to increase their knowledge of cryptocurrencies and the dark web and develop new technologies and strategies to track and prosecute criminals. Governments can also work to regulate and oversee cryptocurrency exchanges and other services in order to prevent them from being used for criminal activities.

The rise of money laundering on the dark web with cryptocurrencies is a complex and ever-changing issue, but it is one that must be addressed if we are to effectively tackle crime in the digital age. It will take a collective effort from governments, law enforcement agencies, and the cryptocurrency industry to come up with solutions and stop the misuse of cryptocurrencies for illegal activities.

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