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Cryptocurrency scams and thefts siphoned off $1.2B in early 2019

Old-era problems afflict new-era finance, according to CipherTrace's report.

Stephen Shankland Former Principal Writer
Stephen Shankland worked at CNET from 1998 to 2024 and wrote about processors, digital photography, AI, quantum computing, computer science, materials science, supercomputers, drones, browsers, 3D printing, USB, and new computing technology in general. He has a soft spot in his heart for standards groups and I/O interfaces. His first big scoop was about radioactive cat poop.
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Stephen Shankland
La Maison du Bitcoin in France

La Maison du Bitcoin in France

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The new technology of cryptocurrency isn't immune to the old problems of money -- with theft, fraud and scams resulting in losses of $1.2 billion in the first quarter of 2019.

That's the assessment of CipherTrace, a startup specializing in tracing  cryptocurrency  flows to detect things like money laundering. It releases quarterly reports on criminal use of the technology.

The figures indicate that cryptocurrencies like bitcoin , ether and Monero, despite their possible benefits in the world of finance, are more complex, fast-moving and opaque than many of us can comprehend.

But regulations are following criminality into the cryptocurrency realm, CipherTrace said, in particular a "tsunami of tough new...regulations" scrutinizing cryptocurrency laundering. That refers to the conversion of ill-gotten cryptocurrency wealth into regular money that's not tied to any illegal activity. "As of April 2019, 17 countries plus the European Union...had at least some regulation or standard-setting bodies dealing with cryptocurrencies."

CipherTrace also detailed other developments in the world of cryptocurrency, including an effort by Iran to use cryptocurrency to evade sanctions' restrictions on payment systems. It also mentions efforts in France and Texas to ban "private coins" like Monero and Bitcoin Private that shield the identities of those involved in transactions.