The UK National Crime Agency (NCA) has issued a requirement for cryptocurrency mixing service operators.
The NCA has called for regulation of technology to help hide transactions that could otherwise be tracked on the blockchain.
The head of the NCA’s Financial Investigation Unit, Gary Cathcart, believes that cryptocurrency mixing services such as CoinJoin can be used by criminals to disguise the origin of a cryptocurrency by forming a transaction from the data of several participants.
“They can be used to provide a layering service, mixing criminal cash, hiding a control trail – similar to how criminals can use the cash business to legitimize money through the banking system,” Cathcart said.
The NCA requires cryptocurrency mixing services to comply with anti-money laundering (AML) laws, conduct customer due diligence (KYS), and track the exchange of funds on their platforms.
Late last year, the U.S. government created the Cryptocurrency Law Enforcement Task Force, which is mandated to oversee crimes sponsored by cryptocurrency exchanges, mixers, and other market participants. A month before the creation of the working group, the US and UK governments agreed to join forces to combat ransomware and the illegal use of digital assets. Recently, the transaction mixing service CoinJoin, which is part of the Bitcoin wallet Wasabi Wallet, began blocking addresses on the Bitcoin network suspected of criminal activity.
Source: Bits
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