Experts say that the rise in Bitcoin prices and the media attention surrounding the launch of cryptocurrency ETFs have exacerbated the prevalence of investment fraud, with the flagship cryptocurrency becoming the most frequently mentioned product offered in fraudulent investment schemes. This is partly because people with little investment experience do not fully understand the specifics of investing in digital assets, Europol writes.
“Companies issuing Bitcoin ETFs will have to hold significant reserves in the cryptocurrency, making them valuable targets for various types of fraudsters,” Europol said.
The report highlights the increased use of Bitcoin as a gateway to cryptocurrency exchanges to hide criminal proceeds. For example, Europol specifically highlighted the exchange of Bitcoin with Monero and other privacy coins that claim modus operandi principles.
Europol says international criminal groups are actively exploiting the digital finance industry, including Bitcoin, which poses objective challenges to law enforcement’s legitimate access to criminal communications. EU law enforcement is particularly concerned about Web3’s emphasis on decentralization, which will lead to new ways of criminal interaction that “will not be controlled or regulated by governments or private companies.”
A recent study by analytics company Elliptic found that cryptocurrency fraud in Southeast Asia has reached industrial proportions, costing digital asset holders tens of billions of dollars in losses.
Source: Bits
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