US Federal Agencies Unite to Form ‘Mini-FBI’ for Dark Web Crypto Crime

Andrew Throuvalas
Last updated: | 2 min read
Adobe / daniel0

The U.S. government has established a new task force for targeting crypto crime consisting of five investigators from different federal agencies.

Established on June 15, the “Darknet Marketplace and Digital Currency Crimes Task Force,” aims to “disrupt and dismantle criminal organizations” that use the “appearance of anonymity” provided by digital currencies to enable drug trafficking, money laundering, and other crimes. 

Its activities will be contained to Arizona for the time being.

“As these criminal activities and enterprises have become more sophisticated, law enforcement tools, resources, and intelligence have had to adapt,” stated a press release shared from the U.S. Immigration and Customs Enforcement website on Tuesday.

The crossover includes agents from the Department of Homeland Security (DHS), IRS Criminal Investigation Unit (IRS-CI), U.S. Drug Enforcement Administration (DEA), Department of Justice (DOJ), and U.S. Postal Inspection Service (USPS).

All five agencies have completed a slew of criminal investigations over the years pertaining to cryptocurrency, which is growing as a tool for bypassing the checks and balances of the traditional financial system.

Last year, for example, the DOJ reclaimed $3.6 billion in Bitcoin stolen from crypto exchange Bitfinex in 2018 – its largest financial seizure in history. Later that year, the department seized 50,000 Bitcoin (BTC) linked to Silk Road – a now defunct darknet marketplace that used Bitcoin to facilitate transactions for drugs, weapons, and other illegal items.

“DEA is committed to saving lives,” said DEA Special Agent in Charge Cheri Oz. “Drug traffickers who are hiding in the darknet will be aggressively targeted and unmasked by this task force.”

Meanwhile, IRS-CI Special Agent in Charge Al Childress said that his unit is “increasingly dedicating more investigative time and agent expertise to tackle darknet and cryptocurrency crimes.”

While the amount of money stolen through cryptocurrency-related crimes is growing each year, its share of the absolute total of crypto-related transactions continues to fall, per Chainalysis data

Furthermore, the US Treasury Department confirmed in a risk assessment report last year digital assets are still used far less for money laundering than fiat currency.

Nevertheless, the Treasury also highlighted “national security” risks related to the decentralized finance (DeFi) ecosystem in April, as it can also be leveraged by ”thieves” and “ransomware actors” to launder their proceeds.