Ponzi

Bitcoin

<p>Europol has warned of the threat of criminal exploitation in bitcoin mining and layer-2 solutions. What Europol Thinks on Crypto Mining<br>Europol reported how the European police body is tackling the abuse of Bitcoin mining by organized criminals. Crypto mining is seen as the method of choice for money laundering ill-gotten gains by criminals. Europol said in the <a href="https://www.europol.europa.eu/cms/sites/default/files/documents/EU_Innovation_Hub_First%20Report%20on%20Encryption.pdf?data=sg8cryptoy8enews0id" target="_blank" rel="noopener noreferrer nofollow">40-page report about cryptographic encryption</a>, based in The Hague, on how such operations could conceal illegal proceeds. Some of the mining pools attract fraudsters or ransomware operators.</p>
<h2 class="wp-block-heading" id="specific-cases-of-mining-crypto-exploitation">Specific Cases of Mining Crypto Exploitation</h2>
<p><br>Europol cites cases in which pools are used to promote Ponzi schemes. The most blatant case was that of the BitClub Network; in this case, it claimed, falsely, to afford to earn promises through pool mining. This cost hundreds of millions of euros, having a substantial <a href="https://btc-pulse.com/tether-invests-18-75m-in-xrex-payments/" rel="noopener noreferrer nofollow">financial </a>impact.</p>
<h2 class="wp-block-heading" id="layer-2-solutions">Layer 2 Solutions</h2>
<p>Law Enforcer’s Next Headache Other than the cryptocurrencies used for crypto mining, the rest of the business has evoked further worries from Europol. For instance, the agency pointed out that layer-2 applications and zero-knowledge proofs on the blockchain represent the significant challenges in the company in terms of tracing. Indeed, most such <a href="https://btc-pulse.com/price-prediction/bonk-price-prediction-2024/" rel="noopener noreferrer nofollow">technologies </a>are also adopted in the very quest to scale and offer privacy, which for law enforcement investigations might mean almost the opposite if it is complicated to track ill-gotten transactions.</p>
<h2 class="wp-block-heading" id="slip39">SLIP39</h2>
<p>Disadvantage of the SLIP39 standard It also discussed the issues with the SLIP39 standard, also called the Shamir Backup standard, built into hardware <a href="https://btc-pulse.com/south-korea-classify-nfts-new-crypto-regulations/" rel="noopener noreferrer nofollow">crypto </a>wallets. It makes room for the slicing of the recovery seed into parts, thereby practically making it next to impossible for the law enforcement agent to recover a criminal’s wallet. Each share is built of 20 words and needs a user-configured number of shares to heal, so the level of hassle went up even more.</p>
<h2 class="wp-block-heading" id="conclusion">Conclusion</h2>
<p>The Europol report has stressed that changes in the crypto space must be monitored well and that technologies at the cutting edge have to be adequately taken care of. What especially worries the agency is the dual use of these technologies: on the one hand, innovations bear benefits, but on the other hand, crimes can be committed by using them. The strategies and tools for law enforcement will need to grow in pace with these new forms of crime in a crypto industry that never stops expanding and innovating.</p>

Europol Cautions That Criminals Will Exploit Bitcoin Mining, Layer-2 Solutions

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