Around the world, governments have cracked down on virtual currency-related crimes. The list of countries where law enforcement has taken a stand reads like an itinerary for a world tour, encompassing England, Greece, Italy, Hungary, and the United States.
In late July, Greek police arrested Alexander Vinnik for his role in black market exchange BTC-e. Vinnik is accused of laundering up to $4 billion through his business. Now, the US Department of Justice is working to extradite Vinnik, who faces up to 55 years in prison.
Just last week, London police arrested a man who ran a boiler room, peddling a non-existent cryptocurrency to unsuspecting (and perhaps overeager) investors. The cold-calling con artist reportedly swindled victims out of a cool 160,000 pounds before he was nailed by the fuzz.
Also, over the last several months, an assortment of government agencies across the globe dispersed warnings about fraudulent cryptocurrency schemes. The Hungarian central bank even convened a task force to investigate one shady venture entitled “OneCoin.” More recently, on August 10, 2017, the Italian Competition Authority issued a 2.6 million-euro fine to One Life Network Ltd., promoter of OneCoin.
Sleazy scam artists and conniving criminals have been drawn to cryptocurrency like moths to a flame. As the value of virtual assets has skyrocketed, the risks to consumers have grown proportionately. While regulation lags behind, the good news is that law enforcement has attentively policed the virtual world.
Looking ahead, international cooperation and information sharing will remain critical. Standardizing the legal status of digital assets, collaborating through extradition agreements, and coordinating multi-national forensic analysis will be essential to law enforcement efforts.