Respected cyber-threat intelligence company, Recorded Future, recently released findings regarding the digital currency of choice amongst the online criminal fraternity.
Altcoins are an ideal mode of exchange for those engaging in illegal activities online, as they offer relative anonymity, easier access, and swifter transaction speeds compared to fiat currencies. The unregulated nature of cryptocurrencies means that governments and existing financial institutions are not as adept at tracing evidence of money laundering, and other activities that would raise instant red flags if attempted via the banks.
That’s not to say such tracing is impossible, however: transactions between anonymous altcoin accounts can certainly be traced by law enforcement authorities, but it is a more arduous task getting permission with the blockchain and the exchanges being the property of private companies, and the coins themselves only holding a borderline definition as currency, per se.
Besides, if Record Future is right, such cyber-criminals are not overly concerned about anonymity and traceability, preferring instead to target cybercurrencies that are available in abundance. Their findings show that the unrestricted Litecoin is much more commonly used by online criminals than the much more secure digital currency Monero.
This has come as a surprise to researchers, many of whom expected the more anonymous Monero to be more popular among cyber-criminals. Traditionally, those who traffick in illegal goods or contraband tend to use a unit of currency that is designed to be difficult to trace. Whilst Monero certainly fulfils that criteria, it has a rather large flaw, from a seller’s perspective – you can’t store Monero on a memory stick (at least, not easily).
That makes all the difference when you want to shift money at your own convenience. Also, if you’re a criminal yourself, you’re only too aware of how altcoin exchanges could potentially be hacked and your online cryptocoins stolen forever.
Litecoin, by comparison, bears a closer relation to Bitcoin in that it can be easily and conveniently stored offline, and traded from any online terminal. Ironically, this actually makes it more anonymous for the sorts of transactions online criminals are using the money for.
Image Source: Flickr