Bitcoin Remains the Most Used Cryptocurrency by Criminals, Even With the Rise of Privacy Coins Like Monero

According to the recent Europol Internet Organized Crime Threat Assessment report, financial crimes are also still the main illicit crypto use.

Criminals are still using Bitcoin the most, despite the rise of privacy coins like Monero, according to a recent report by Europol.

Financial crimes also remain the main illicit use of crypto, with Bitcoin being the preferred asset for ransomware groups due to its accessibility for non-savvy users compared to alternatives like Monero (XMR). However, criminals often convert Bitcoin to stablecoins to avoid market volatility, particularly when obtained through investment fraud.

The increasing prices of cryptos and media attention have led to a surge in fraudulent investment schemes, according to the report. Cryptocurrencies, particularly the U.S. dollar-pegged stablecoin Tether (USDT) on the Tron (TRX) network, are frequently reported in such schemes, likely due to the network’s low transaction fees.

There is also a growing use of altcoins in illicit activities, with underground banking and crypto debit cards gaining popularity for quick conversion to cash at automated teller machines (ATMs).

Criminals are also increasingly using encrypted messaging apps for cash-to-crypto exchanges, which allows them to bypass compliance checks and conceal their identities.

Meanwhile, Europol expressed concerns about the approval of spot Bitcoin exchange-traded funds (ETFs), saying that they could open new avenues for scammers. Moreover, companies issuing these ETFs hold significant crypto reserves, making them attractive targets for fraudsters.

Monero is gaining traction among criminals

While Bitcoin remains the preferred crypto for ransomware groups, Europol’s report highlights the rising use of Monero (XMR) as an alternative. Monero’s privacy features make it an optimal choice for criminals looking to conceal their funds.

In January 2024, a significant crypto-jacking operation was uncovered in Ukraine. The operation had covertly mined over €1.8 million ($1.95 million) worth of cryptos. While the scheme primarily focused on mining Monero, it also included Ethereum (ETH) and Toncoin (TON).

The report emphasized that the decentralization inherent in Web3, blockchain technology, and peer-to-peer (P2P) networks creates environments conducive to cybercrime. These technologies enable transactions to be conducted anonymously and beyond the reach of authorities. Europol warned that as these decentralized systems continue to evolve, they will increasingly facilitate cybercriminal activities.

Europol noted law enforcement’s challenges in tracking and prosecuting such activities, especially when virtual asset service providers are non-compliant and offshore-based. This is due to privacy laws, especially concerning end-to-end encryption (E2EE) communication platforms, which prevent law enforcement agencies from accessing any criminal communications.

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