Europol has hailed the independence and protection that blockchain technology offers, amid what is said to be a rapidly evolving financial and economic crime that threatens the European Union’s internal security.
Europol has also expressed concern about the rise in criminal activity within decentralized finance (DeFi).
Europol warns of increasing criminal activity in DeFi and NFT sectors
Europol, the European Union law enforcement cooperation agency, recently published the European Financial and Economic Crime Threat Assessment.
This report highlight The complexity of financial and economic crimes affecting the EU, including money laundering, corruption, fraud, intellectual property crimes and counterfeit currencies. It emphasizes the importance of cooperation, information sharing and public-private partnerships to effectively combat such criminal activities.
The fintech revolution, characterized by the integration of technology into financial services, brings opportunities and risks. Criminals are rapidly exploiting these innovations, particularly within digital banking and non-bank financial institutions.
Decentralized finance (DeFi), based on blockchain technology, promises greater independence and security. However, the lack of regulation in this area leaves room for economic crimes to occur as criminals store illegal assets on DeFi platforms.
The high volatility of cryptocurrencies also makes them targets for fraud and money laundering.
Non-fungible tokens (NFTs) are rapidly growing in popularity, but their instant transaction capabilities also attract scammers. NFTs pose significant money laundering risks given their cross-border trading capabilities.
Europol requests cooperation in fighting financial crime in the EU
Additionally, the emergence of the metaverse, a digital space for various activities, has been adopted by the financial sector, creating new opportunities for criminals. Incidents of fraud and theft within the Metaverse have already been reported, indicating potential trends for organized crime in this virtual environment.
In a recent incident in January 2023, law enforcement demolished The crypto platform known as Bitzlato is suspected of illegal money laundering linked to Russian companies under EU sanctions.
This platform has enabled quick conversion of various files. cryptocurrency Assets worth an estimated 2.1 billion euros were converted into Russian rubles, a significant portion of which was related to criminal activities.
In the face of these evolving financial and economic crimes, Europol emphasizes the need for proactive measures, international cooperation and staying ahead of criminal innovation to ensure the security and stability of the European Union.
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