Cybercriminals prefer fiat money and other traditional criminal methods. Some groups that trade Bitcoin also favor exchanges with cash.

For years, the narrative that criminals preferably use cryptocurrencies way for money laundering has grown. However, a new report from the Society for Worldwide Interbank Financial Telecommunications (SWIFT) claims just the opposite. This financial organization considers that crypto-assets play an insignificant role in money laundering and restates that cash is still the most widely used method for such purposes.

“The number of identified cases of money laundering through cryptocurrencies remains relatively small, compared to the volumes of cash laundered through traditional methods,” said SWIFT in its report on the laundering of money from large-scale cyber robberies.

SWIFT is the organization that manages the interbank messaging system that almost all banks in the world use to transfer funds to each other. These institutions use it to transfer billions of dollars every day.

In recent days, SWIFT noted in its document that it has been stimulating research with the idea of understanding how banking institutions can better protect themselves from cyberattacks. In that search, they considered it significant to know about what happens to the stolen funds.

In this way, the report focuses specifically on knowing the techniques that cyber attackers use to launder money from successful attacks and how they prevent the tracking of those funds. The research shows that traditional methods such as the use of mules, front companies, and cash are the formulas that criminals use the most for money laundering.

The report adds that cybercriminals seldom make use of cryptocurrencies, or even of digital money.

Cryptocurrencies in Money Laundering

Authorities’ concerns regarding money laundering should point to the use of cash and the use of mules to move the stolen money, according to the SWIFT report. However, the document mentions some criminal groups that use cryptocurrencies, such as the Lazarus Group, which is allegedly directed by North Korean hackers to steal money.

SWIFT said that the Lazarus Group stole money from banks and then exchanged the funds into cryptocurrencies. They reportedly operated through different exchanges to hide their origin and then converted the crypto assets back into fiat currency before sending them to North Korea.

Another example is a gang from Eastern Europe that established its Bitcoin farm in East Asia. According to the report, this group used funds stolen from banks to operate the farm, generate Bitcoin, and then spent the mined coins in Western Europe. When the police gang arrested, SWIFT said that the authorities found 15,000 BTC valued at USD 109 million, two sports cars, and USD 557,000 worth of jewelry at the group leader’s home.

It is not the first time that investigations have noted that the use of cash is the method of money laundering that criminals prefer. In 2019, the ratio between US dollars related to money laundering and Bitcoin funds circulating on the darknet was 800:1, according to data from the cryptocurrency market monitoring portal Messari.

By Alexander Salazar


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