Cryptocurrencies are no longer safe from criminals

Cryptocurrencies are no longer safe from criminals

Hack 3.6 billion dollars Bitfinex Exchange and Freedom Convoy in Canada show that it is entirely possible for law enforcement to investigate and seize cryptocurrencies.

Bitcoin (BTC) is often viewed by cryptocurrency advocates as an asset that is not tightly controlled by governments or laws due to its decentralization.

However, the hack 3.6 billion dollars The New York couple’s Bitfinex exchange or the way the Canadian government has frozen accounts with crypto in support of the “Freedom Convoy” protest show the opposite.

The above situations raise a question: if cryptocurrencies are used for malicious purposes, what will governments do with the assets?

Bitcoin is no longer out of control.

In general, countries have different approaches to each situation as there are no specific regulations. “The US government is working on a method to recover Bitcoin stored in cold wallets by hackers,” said Crane Hassold, a former US Federal Bureau of Investigation (FBI) analyst.

Mr. Crane believes that cyber criminals use cryptocurrencies for their activities. This puts some pressure on lawmakers to take steps to legalize cryptocurrencies and develop strategies to deal with hacks.

Bitfinex Exchange Hack causes damage 3.6 billion dollars is considered a typical example of the process of working with the amount of illegally used cryptocurrency. According to the US Department of Justice, this is “the largest amount of property confiscated in history” and proof that “cryptocurrency is not a haven for criminals.”

Lichtenstein, the husband in the Bitfinex case, stored private keys used to log into digital wallets 3.6 billion dollars Bitcoin on multiple cloud computing platforms. Immediately after the Justice Department made a decision to search the cloud provider, they accessed a file containing the addresses of 2,000 digital wallets and their secret keys.

The whole number Bitcoin is confiscated “under the control of the US government”. However, it is not clear how the US investigative agency will deal with the amount of cryptocurrency seized.

Across the ocean, British police have made more impressive moves. Manchester City’s investigative team just returned it 5 million dollars for victims of numerous cryptocurrency scams.

UK police say they have seized 1 USB stick ten million dollars in the form of Ethereum that came from scam and decided to return it to the victim. According to DeCrypt, 435 million dollars is the total amount of bitcoin recovered from illegal activities in the UK from 2017 to present.

Under the UK Criminal Code, cryptocurrencies are considered an asset and not cash like in the US. Therefore, in order to confiscate illegally used digital currencies, a court decision is first required. This is the difference when the US Department of Justice has seized the entire amount Bitcoin out of the hack before the mastermind couple was convicted.

behavior in case of emergency

On the other side of the US border, Canada is also taking care of the crowds Bitcoin Donated to the “Freedom Convoy” movement. This is a protest against the government’s Covid-19 policy on truckers.

On February 15, the Canadian government used a provision of the Emergency Situations Act to ban all accounts supporting protesters, including digital wallets.

This provision allows the government to freeze funding without a court ruling. “For the first time, the Canadian government has taken decisive action against bitcoin and cryptocurrencies,” said Paul Champ, an attorney in Ottawa, the Canadian capital.

Protesters can’t even buy, sell, or pay for support in digital currency, a supposedly decentralized asset. The Canadian government’s actions have hit the protesters’ weak point. According to Decrypt, about 150 crypto wallets are on the frozen list.

The Canadian government’s blow has sparked interest in the nature of cryptocurrencies and the types of wallets investors should keep.

Commenting on the protest, Brian Armstrong, CEO of cryptocurrency exchange Coinbase, said that using non-custodial wallets is an important thing for crypto investors. This type of wallet allows users to manage their own digital currency, avoiding their accounts being frozen by third parties or regulators.

Additionally, using an uncustodial wallet helps reduce situations where your account information is hacked or exposed due to malicious clicks. This limits fraud or appropriation of digital currencies.

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