Understanding the Evolving Landscape of Financial Crimes and Cybercrimes Using Cryptocurrencies

Abstract

This chapter examines the emerging trends between cryptocurrencies, financial crimes, and cybercrimes. While cryptocurrencies promote transaction efficiency, the decentralized and anonymous features give rise to ample opportunities for financial crimes, such as Initial Coin Offering (ICO) fraud, cross-chain money laundering, and crypto-enabled financial crimes (e.g., crypto thefts). Cryptocurrencies also facilitate the avenue of cybercrime through cyber-dependent crimes (e.g., crypto ransomware), cyber-enabled crimes (e.g., crypto scams), and online illicit cryptomarkets. Along with financial loss, victims' psychological and social harms are further exacerbated by forensic complexities. Networked approaches are recommended to prevent and mitigate the harms, which are composed of nodal and interoperable engagement between criminal justice systems, financial institutions, and technological companies. The findings underscore the importance of ongoing research and adaptive regulations against evolving conundrums posed by cryptocurrency-related financial crimes.