The U.S. Secret Service is cracking down on illegal cryptocurrency transactions, seizing over $102 million in cryptocurrency from cybercriminals related to fraud investigations.
David Smith, assistant director of investigations, said specialists and analysts are actively monitoring the flow of Bitcoin and other cryptocurrencies on the blockchain, similar to an old-fashioned surveillance.
“When you follow a digital currency wallet, it’s no different than an email address that has some correlating identifiers,” Smith said in an interview at the agency’s headquarters. “And once a person and another person make a transaction, and that gets into the blockchain, we have the ability to follow that email address or wallet address, if you will, and trace it through the blockchain.”
The seizure of more than $102 million in crypto has occurred in 254 cases since 2015, according to statistics compiled by the agency.
“One of the things about cryptocurrency is it moves money at a faster pace than the traditional format,” Smith said, adding that the quick pace of transactions makes it attractive to both American consumers and criminals. “What criminals want to do is sort of muddy the waters and make efforts to obfuscate their activities. What we want to do is to track that as quickly as we can, aggressively as we can, in a linear fashion.”
Smith was interviewed inside the agency’s Global Investigative Operations Center, known as the “GIOC,” in which agents and analysts track cryptocurrency transactions worldwide in a secure room at the agency’s headquarters. He compared the illicit digital money trail to
Once the Secret Service pins down the illegal activity, it works to “dig a little deeper into those transactions and deconstruct [them],” Smith said. “You send me something bad on an email, I know there’s some criminal activity associated with that email address, I can deconstruct, find whatever tidbits of information that you used when you initially logged in or signed up for that email address.”
Investigators found out that criminals are swiping Bitcoin and other cryptos into stablecoins. Therefore, in order to track this activity, they are keeping an eye on the market. “Because, you know, the criminals, they’re humans too. They want to avoid some of that market volatility associated with some of the major coins,” he said.