MONEY LAUNDERING USING CRYPTOCURRENCIES

This paper examines the growing issue of money laundering through cryptocurrencies on a global scale. Criminals use digital assets to launder illicitly obtained funds, converting them into cryptocurrencies to obscure the origins of the money. Unlike traditional financial systems, decentralized finance (DeFi) platforms lack mechanisms to freeze or block funds from suspicious sources, presenting a unique challenge for law enforcement. However, the blockchain underlying cryptocurrencies allows for the tracking of transactions across DeFi protocols, making it possible to trace asset movement, albeit with difficulty due to complex methods criminals use to mix and transfer funds across multiple wallets. The study employs official data from financial institutions between 2019 and 2023, using time-series analysis to forecast money laundering trends under both optimistic and pessimistic scenarios. The paper concludes by highlighting the ongoing efforts by regulatory bodies to strengthen measures aimed at preventing cryptocurrency-related money laundering.

In order to draw adequate conclusions, the data used in the paper are official data from financial institutions relevant to money laundering. The time series used in the paper includes data related to the period from 2016 to 2023 and the forecast model based on optimistic and pessimistic scenarios is constructed.