Check this out, it’s fascinating & comes from Jeff Brown in his “Bleeding Edge” tech publication. He’s a reputable & reliable source of intel with his nose to the ground in all things tech. It’s an interesting insight on what’s going on under the Alt coin hood. I paste his article verbatim below.
“State-backed theft and money laundering in the digital asset space…”
We just got an interesting insight into how North Korea “raises” capital to fund government projects. According to a recent U.N. report, state-backed cybercriminals stole about $1.5 billion in cryptocurrency “altcoins.” These are smaller, lesser-known cryptocurrencies compared to Bitcoin and Ethereum.
Once stolen, the cybercriminals run the altcoins through a “mixer.” This is a service that mixes the coins with those of other users so that the coins they put in are not the same coins they get out. That makes them harder to track.
Then they move the altcoins to a loosely regulated digital asset exchange and convert them to cash. That cash is reportedly used to fund government programs, including North Korea’s nuclear program. This is essentially money laundering but with digital currencies.
And according to analysts at FireEye’s Mandiant Threat Intelligence division, North Korea’s cybercriminals have a critical advantage that most other criminals don’t have – they are state-backed. Once they convert the altcoins to cash, they don’t have to worry about bringing the funds back “onshore.” The North Korean government supports them. That makes them very good at what they do. But it’s not all bad news. There are two takeaways here…
First, it is a misconception that cryptocurrencies can’t be traced. On the contrary, most can be tracked. On the contrary, most can be tracked. Public addresses make it possible to see how cryptocurrency funds are moving. And advanced software has been developed specifically to track cryptocurrency transactions. So bad actors like this aren’t avoiding detection even when they think they are using “untraceable” altcoins.
And the second takeaway is that digital asset use for illicit purposes is not widespread in the industry. White hat cybersecurity analysts have demonstrated that most of the shadowy activity in the space is tied to state-backed cybercriminals like this.
The reputable projects in the digital asset space, on the other hand, are fully compliant with the laws and regulations in their locale. Hopefully, that will encourage officials to create a friendlier environment for cryptocurrencies and digital assets here in the U.S.
Sadly, the U.S. regulatory environment still has a lot of work to do in this space before it is welcoming to investors wanting to participate in capital formation. That’s what’s truly needed to help this industry grow and thrive.