Characteristics of Crypto that Facilitate Money Laundering

  1. Anonymity, some cryptos are indeed designed to provide full privacy to their users, so the user's identity will not be revealed in transactions.
  2. Decentralized, crypto operates on a blockchain network where no central authority oversees transactions.
  3. Fast international transactions, crypto allows cross-border transactions quickly and cheaply without time and region restrictions.
  4. Lack of regulation, the absence of established regulations related to crypto in various countries allows criminals to exploit this loophole.

Money Laundering Schemes Through Crypto

  1. Layering (placement)
  • Direct purchase of crypto directly, the perpetrator buys crypto with money from crime through an exchange platform that has loose or no user identification (KYC) procedures.
  • Peer-to-peer (P2P) Exchange, users can directly buy crypto from other people without intermediaries or without KYC, making it difficult for authorities to track.
  1. Integration (layering)
  • Tumbling, buying crypto with a mixing method from various other users, then the user will receive back an equivalent amount, but from a different source, making transaction tracking very difficult.
  • Cross chain Transfer, the perpetrator transfers between cryptos such as from bitcoin to xrp to complicate transaction tracing.
  • Multiple wallet, the perpetrator can have many digital wallets on various platforms and store the crypto scattered in each wallet, making transaction tracking difficult.
  • Decentralized Finance (DeFi) is a decentralized financial system that operates on top of a blockchain that has no intermediaries. Transactions using DeFi will obscure the origin of user funds.
  1. Common Money Laundering Schemes (integration)
  • Reselling crypto for cash, after the funds go through a "layering" process, the perpetrator can exchange their crypto for fiat currency on an exchange. Investing in legal assets, by buying legal assets using crypto, then reselling them as a legitimate source of funds.Using fictitious businesses, perpetrators can create fictitious businesses that receive payments through crypto, then these businesses can claim that the funds were obtained from legitimate commercial activities.
  • Money laundering through cryptocurrency occurs by exploiting technological advancements by riding on the anonymous, decentralized nature of crypto, perpetrators can use various methods as described above. Regulators, in this case the authorities, are expected to be able to overcome loopholes in this technology.
  • Money laundering through cryptocurrency occurs by exploiting technological advancements by riding on the anonymous, decentralized nature of crypto, perpetrators can use various methods as described above. Regulators, in this case the authorities, are expected to be able to overcome loopholes in this technology.

Pencucian uang melalui cryptocurrency terjadi dengan cara memanfaatkan kemajuan teknologi dengan menunggangi sifat crypto yang anonim, desentral, pelaku dapat menggunakan berbagai metode seperti yang telah dijelaskan di atas. Regulator, dalam hal ini pihak berwenang diharapakan mampu menanggulangi celah dalam teknologi ini.