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Previously, the use of cryptocurrencies in money laundering practices was reported to be increasingly widespread, to hide the origin and movement of funds obtained illegally,

That's according to a report by New York-based blockchain analytics firm Chainalysis, which examines new trends and methods in money laundering.

Quoting CNBC International, Tuesday (16/7/2024) Chainalysis stated that crypto is used for off-chain crimes such as drug trafficking and fraud because these digital assets are cross-border, almost instant, and generally cheap to transact.

“The increasing presence of crypto has made it a tool for laundering proceeds from a variety of off-chain crimes, such as drug trafficking and fraud. By 2024, money laundering in crypto will encompass all crimes, not just those inherently related to the crypto ecosystem,” Chainalysis said in a report released in July 2024.

This comes as the value of the world's largest cryptocurrency, Bitcoin, has surged almost 55% so far this year, according to LSEG.

According to Chainalysis, money launderers use a variety of methods such as crypto mixers, cross-chain bridges, and wallet-hopping to hide the flow of funds.

Crypto mixers, or tumblers, involve mixing crypto from multiple sources to make it harder to detect its origin and ownership.

Criminals also leverage crypto bridges to hide the origin of funds by moving them between different blockchain networks.

Since 2019, $100 billion worth of funds have been transferred from illicit wallets to conversion services, where crypto is converted into fiat currencies, according to Chainalysis data. The highest amount identified was $30 billion in 2022.