The rising use of “cross-chain bridge providers” — which switch cryptocurrency from one blockchain to a different, bypassing any centralized entities like an trade — has made it harder to trace cryptocurrency funds, particularly the place it considerations cash laundering. One such service alone, RenBridge, is believed to have laundered over $500 million in prison proceeds.
That is in keeping with a current report from Elliptic, which offers cryptocurrency monitoring and compliance options. It famous that transaction quantity on these bridges has risen since October 2020, and whereas the latest peak appears to be this previous January, lots of of tens of millions of {dollars} price of transactions nonetheless happen often. The report steered that a lot of this exercise is linked instantly with prison exercise, noting that this started occurring as crypto exchanges grew to become extra regulated.
An evaluation by the corporate discovered that one cross-chain bridge particularly, RenBridge, has been used to launder at the very least $540 million in cryptoassets originating from theft, fraud, ransomware and different forms of prison exercise since 2020. It additionally stated RenBridge is a vital facilitator for Russia-linked ransomware gangs, with over $153 million in ransom funds laundered by the service thus far.
Purloined cryptocurrency makes up the largest portion of illicit exercise stated to be laundered by RenBridge, accounting for 49.2% of identified proceeds, adopted by:
- Funds from ransomware assaults, at 28.4%;
- The mysterious “different” at 10.8%;
- Cash from Ponzi schemes, at 9%;
- Darkish web markets at 2.1%; and,
- Stolen bank cards at 0.5%.
Whereas the usage of cross-chain bridges has made cryptocurrency harder to trace, the report says it isn’t unimaginable as a result of there stays an excessive amount of transparency within the sector. Doing so, nevertheless, often entails lengthy handbook searches. Elliptic just lately launched software program that gives automation options for such investigations.