Bitcoin-based scam means the federal government now needs a crypto bank

Due to the surge in crime caused by cryptocurrency, federal law enforcement agencies are seizing large amounts of Bitcoin. Now the US government is considering how to deal with all this.

This week, a small cryptocurrency custody platform called Anchorage Digital Announce It won a contract from the Department of Justice to store and liquidate digital assets seized by federal law enforcement agencies after criminal investigations. The government basically hired a bank to store and sell billions of dollars worth of confiscated cryptocurrencies, including large amounts of Bitcoin and Ethereum.Anchorage Digital in San Francisco is the obvious choice for partners because it The first federally chartered crypto bank.

Diogo Monica, co-founder and president of Anchorage, told Recode: “There are actually no traditional banks that provide these services, because from a technical point of view, it’s very complicated.” “It’s difficult to store these things securely. In fact, there’s a lot of information about it. A story that people cannot access their Bitcoin and other cryptocurrency wallets, and cannot access them at all and cannot be restored.”

The US Marshals need to hire a cryptocurrency company to seek help, which reminds us that as such digital assets become mainstream, they are becoming more and more popular with criminals. In fact, as law enforcement agencies shut down illegal cryptocurrency businesses, from ransomware programs to illegal online markets, it is clear that the US government can hold large amounts of Bitcoin, Ethereum, and other cryptocurrencies. Therefore, Uncle Sam may even become a more important player in the crypto market in the coming months and years.

Since its creation, cryptocurrencies have been popular with criminals because accounts and transactions are difficult to trace back to anyone.Now, cryptocurrency is at the center of a large number of illegal schemes including extortion scam, Covid-19 vaccine counterfeiting, money laundering activities and Illegal sales on the dark web. In the first half of this year, people sent over 2 million U.S. dollars worth of cryptocurrency to Elon Musk’s imposters Wronged On social media, According to the Federal Trade Commission (Federal Trade Commission). Earlier this month, a Swedish man was sentenced to 15 years in prison. Plead guilty Planning one of the largest cryptocurrency-based Ponzi schemes ever prosecuted by the U.S. government. Under the guise of a (fake) gold investment opportunity, the man tricked people into sending him bitcoin and other digital payments.

“Cryptocurrency is not government currency, so its scope is very international, which is why it has become more popular in transnational organized crime and terrorism,” said Susanna Lynch, a professor at Utica College who specializes in economic crime.

By investigating these crimes and prosecuting the perpetrators, federal law enforcement has obtained a large amount of cryptocurrency. In June, the U.S. Department of Justice seized approximately Bitcoin worth 2.3 million USD The FBI is tracking a Ransom payment related Earlier this summer, the Colonial Pipeline cyber attack.This is after the proxy Approximately 1 billion U.S. dollars seized The cryptocurrency that once belonged to Ross Ulbricht, the creator of the online black market Silk Road, was closed by federal officials in 2013. Arrested That year and is convicted Distributed drugs and money laundering in 2015.

“There is no difference between cryptocurrency and oil tankers because of the lack of better examples, or cars or fiat currencies [currency], When it comes to how it will eventually be used in the asset forfeiture system,” said Ari Redbord, a former prosecutor and head of government affairs at the cryptocurrency fraud detection startup TRM.

The U.S. Marshals Agency is responsible for holding and auctioning many seized assets, including artworks, rare CollectionAnd real estate, from disgraceful drugs Wu-Tang Album by CEO Martin Shkreli arrive Bernie Madoff’s apartmentSince At least 2014, The Ministry of Justice’s asset forfeiture plan is implemented by the bailiff, which has adopted the same approach to cryptocurrencies and opened its confiscated cryptocurrency stores to the public.But the bailiff service Announced in 2019 It is seeking more help to manage all these digital assets.

“Pricing, how to price, how to evaluate, how to liquidate, how to store it safely-people are forced to deal with asset classes because it is very common now,” Monica of Anchorage told Recode.To do this can be particularly tricky because the cryptocurrency market may Extremely unstable.

As DOJ advances its plan to manage digital assets, more and more people are calling for stricter supervision of cryptocurrencies.For example, Senator Elizabeth Warren (D-MA) said this month that cryptocurrencies should Facing stricter rules, And some senators recently proposed a tax on cryptocurrency transactions to fund President Joe Biden’s Infrastructure planEarlier this month, Federal Reserve Chairman Jerome Powell even suggested that the federal government could introduce a digital version of the U.S. dollar as a Alternatives to cryptocurrencies, Although he is still not sure if this is a good idea.

Although lawmakers and regulators are paying more and more attention to cryptocurrencies, their popularity is forcing the government to make adjustments. A recent survey by the University of Chicago research institute NORC found that 13% of people In the past year alone, the U.S. has purchased or traded cryptocurrencies, compared to estimates Half of American households According to Pew, those who have invested in the stock market.

All this reminds us that cryptocurrency will only become more and more common, which means that crypto scammers will not disappear anytime soon. Therefore, pay attention to the demand for cryptocurrency payments from suspicious romantic prospects, incredible investment opportunities, so-called blackmailers, and people who call themselves Elon Musk. If you are not careful, your bitcoin may end up in the federal government’s new crypto bank.

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