The United States Immigration and Customs Enforcement(ICE) makes the existence of a Cryptocurrency Intelligence Program (CIP) public which was in its budget proposal.
According to the proposal,
The BCSC has developed a Cryptocurrency Intelligence Program (CIP) which identifies unlicensed money services businesses in the form of independent cryptocurrency brokers’ use of peer-to-peer (P2P) sites, online forums and classified advertisements, and darknet markets (DNM) to engage in unlicensed money services businesses (MSB) activity.”
The agency believes that a significant portion of MSBs are using darknet markets and are engaged in laundering money made from narcotics.
One of the main purposes of the program is to protect homeland against illicit trade, travel, and finance. Illicit trade includes activities such as cyber-enabled crime, child exploitation, commercial trade fraud, drug smuggling, illicit procurement, falsely labelled commodities and trans-shipment.
ICE says,
“The biggest problem darknet market vendors face is converting virtual currency into traditional fiat currency. To avoid reporting requirements, illicit vendors turn to P2P exchangers or become P2P exchangers themselves in order to liquidate their virtual currency.”
Statistics show that money laundering is a lot more common among banks than cryptocurrency platforms. Banks launder $2 trillion a year. Many exchanges have introduced KYC procedures to ensure that they are compliant with financial regulations as they relate to money laundering.
Since the financial crisis of 2008, there have been different crackdowns targeting money laundering schemes. Many money launderers rely on banks, shell companies, and other methods to launder money. Cryptocurrency presents a small portion of laundered money.
More regulators and government agencies are working to introduce frameworks that position the government to handle the newer masses of cryptocurrency adopters. Taxation is big on the agenda of many governments, with many developed economies already drafting legislation for the taxation of cryptocurrency.
