Connect with us

Research

Cryptocurrency, Terrorists and the Best Coins for Criminals

Published

on

Expecting criminal operators not to make use of cryptocurrency is like expecting a burglar not to make use of a ski-mask.

Cryptocurrency offers a decentralized, accessible path to illegal fund generation, money laundering and liquidity pools, to be used by anyone in any corner of the world, without the oversight of a centralized authority, such as a bank manager.

If the tools are there, then criminals will ultimately make the most of them. This has proved to be the case ever since bitcoin’s inception, where it could mainly be used on the dark web, long before established, reputable real-world vendors ever decided to take notice.

The trend hasn’t slowed – in fact it has flourished, and now a whole host of new coins join bitcoin on the list of coins that dark web vendors will accept for their illicit goods.

At the same time, the rise of cryptocurrency has coincided with the rise of decentralized terrorist networks, and the two look to be inextricably linked from here on out.

Adoption by ISIS

According to a 2016 research paper by Angela S.M Irwin and George Milad, titled ‘The use of crypto-currencies in funding violent jihad’, it has already been shown that terrorists, specifically ISIS, are relying on cryptocurrency to fund their operations, although finding the data isn’t easy. The paper states:

“Although it is difficult to find concrete evidence of large-scale use of Bitcoins and other crypto-currencies by terrorist groups and their supporters, there is strong evidence to suggest that they have been linked to a number of terror attacks in Europe and Indonesia.”

Given the extreme scrutiny which typical financial accounts come under, especially during criminal investigations, it’s no surprise that terrorists are turning to cryptocurrency as a way to outmanoeuvre authorities. The paper continued:

“Supporters of Islamic State of Iraq and Syria (ISIS), jihadists and terrorist organisations are actively looking to and promoting the use of new and emerging technologies, such as Bitcoin, to mitigate some of the risks associated with traditional fund transfer methods.”

It’s not hard to understand the attraction, and using cryptocurrency appears to be a growing trend in terrorist hotspots. The paper summarizes the situation as so:

“Some websites associated with terrorist organisations have started to collect donations in Bitcoins. Many Bitcoin ATMs and Bitcoin exchanges are located in countries that have seen significant numbers of foreign fighters join ISIS in the Middle East and are also positioned in countries that have seen increased risk of terror attack. These present a significant risk because they allow for the seamless, anonymous transfer of funds to and from terrorist groups and their supporters.”

The paper focuses specifically on bitcoin, presumably since it makes up the greater bulk of overall market transactions; however there are other coins which are actually favoured by those engaging in illicit activities to a much higher degree than bitcoin.

Privacy Coins and the Dark Web

Internet research group, Recorded Future, recently published this report on the most common cryptocurrencies used for illicit or unregulated activity on the dark web.

One of the report’s findings was that while bitcoin was still the most common accepted payment method among vendors, it is not the cryptocurrency that dark web users actually favour the most.

The report polled members of a prominent dark web hacking forum, and found that the currency most favoured was, unsurprisingly, Monero.

Monero has gained a reputation as the most private of the privacy coins since its launch in 2014, and has proved the most resistant to the prying fingers of legal authorities.

Following closely in second place is Dash – a crypto payment platform which undoubtedly gains popularity for its ease of use and low fees.

Besides the privacy concerns of individuals buying illegal goods on the dark web, the biggest reason for bitcoin’s decline in popularity is its transaction-to-fee ratio which makes it completely unsuited for smaller, micro-payments.

However, as you can see from the following image, there is a gap between the currencies favoured by criminals and the currencies actually accepted by vendors. As the image illustrates, 100% of vendors on the dark web accept bitcoin.

Following closely in second place is Litecoin, which appears on 30% of vendors’ accepted currency list. Dash comes in at a close third with 20%, while the criminal’s favourite, Monero, only finds use on around 6% of dark web services.

Interestingly, a split appears between Eastern-European and English-speaking regions, with Litecoin and Monero being favoured by those two groups respectively.

The paper quotes a prominent Russian hacker on one of the forums they surveyed as describing how it was the black market which propelled Bitcoin to prominence in the first place, and that the trend will continue with some of the newer coins. He said (translated):

“Do not reinvent the wheel – just look where Bitcoin came from. It came from the darknet, and now U.S members are gradually migrating to Dash, while those in Europe have moved to Monero.”

This sentiment was echoed by another forum user, whose comments bring to mind the oft-quoted rule about how the porn industry is the ultimate arbiter of successful video formats:

“As a rule, whatever [currency] is used by the drug dealers will become a mainstream currency, and they have been actively switching to Dash. There are not so many carders are there are junkies.”

Conclusion

The question at this point isn’t whether such activity is taking place, but what the crypto community plans to do to resolve it.

That’s assuming they decide that it needs to be resolved. We’ve already seen instances of crypto platforms in the past refuse to meddle with their code in any way, even in the event of a major hack.

Such dedication to the ideals of cryptocurrency is one of the strengths of the community, but is also the very things which open up the playing field for criminal utilization.

Regulators may move in eventually, but by that time there will likely be another dozen privacy coins which can step in to carry on the process.

Featured image courtesy of Shutterstock.

Important: Never invest (trade with) money you can't afford to comfortably lose. Always do your own research and due diligence before placing a trade. Read our Terms & Conditions here. Trade recommendations and analysis are written by our analysts which might have different opinions. Read my 6 Golden Steps to Financial Freedom here. Best regards, Jonas Borchgrevink.

Rate this post:

Important for improving the service. Please add a comment in the comment field below explaining what you rated and why you gave it that rate. Failed Trade Recommendations should not be rated as that is considered a failure either way.
0 votes, average: 0.00 out of 50 votes, average: 0.00 out of 50 votes, average: 0.00 out of 50 votes, average: 0.00 out of 50 votes, average: 0.00 out of 5 (0 votes, average: 0.00 out of 5)
You need to be a registered member to rate this.
Loading...

4.5 stars on average, based on 126 rated postsGreg Thomson is a full-time crypto writer and digital nomad. He eats ICOs for breakfast and bleeds altcoins. Wherever he lays his public key is his home.




Feedback or Requests?

Cryptocurrencies

2018 Crypto Crash: Here’s What Actually Caused It

Published

on

Tech-savvy investors have kept their eyes on cryptocurrencies like Bitcoin for several years now. The most prolific form of cryptocurrency has brought backers on a rollercoaster of highs and lows over the past two years. While this culminated with an all-time high of more than $19,000 in 2017, Bitcoin, in particular, would go on to lose almost 70 percent of its value just several months later. And as we saw in the altcoin universe, some losses clocked in at over 95%.

But what exactly caused the recent crypto crash of 2018? Even more importantly, what does the future hold for the various other types of cryptocurrency? Below is a rundown of some of the common themes that precipitated the 2018 selloff.

A Limited Supply Increases Demand

In its purest form, Bitcoin and its competitors are all a form of currency. But the format differs so much from traditional forms of money — like the Dollar or the Euro — that people trade cryptocurrencies as if they were commodities. The limited supply of cryptocurrencies, coupled with increased consumer demand, is bound to inflate the price. But such inflated value can only last for so long.

Crypto Challenges Cause Consumer Hesitation

Bitcoin and other cryptocurrencies are fighting an uphill battle. Not only do they face increasing government scrutiny, standardization and regulation, but they’ve also gained a lot of unfavorable press in the past months and years.

In South Korea, three executives of an exchange called Upbit got charged for making fraudulent transactions that allegedly occurred between September and December 2017. Moreover, there are allegations that those executives sold 11,500 BTC to individuals during rigged transactions that solely benefitted the executives. That’s just one example of recent cryptocurrency corruption.

Plus, people who invest in cryptocurrencies rightfully wonder how secure their funds are. A report indicates that the total amount of cryptocurrency stolen in 2018 will likely reach $1 billion, with the thefts often resulting after hacks happen at the platform layer level or when cybercriminals infiltrate exchanges. When people hear about those headline-capturing events, it’s not surprising if they fear being the next victims.

There was also a widespread belief that cryptocurrencies like Bitcoin were untraceable and that it was impossible to connect transactions back to specific users. However, that claim has been debunked, since there are numerous ways to violate the supposed inviolable privacy cryptocurrency offers and link transactions to the people who performed them.

Between fraudulent transactions, stolen funds, and online privacy concerns in general, many consumers are hesitant to embrace these new platforms. When they balked due to the unsettling events described above and others like them, the hesitation partially caused the crypto crash.

The Effect of SEC Regulation Fears

Potential cryptocurrency investors are also hesitating due to proposed Securities and Exchange Commission (SEC) regulations. They recently considered adding strict control to govern the trade of Ethereum — which caused a lot of concern over the likelihood of even tighter rules and regulations in the future.

Fortunately, the SEC ruled Ethereum is not the same as corporate bonds or stocks. Instead, it’s more akin to commodities like gold and silver. While this has eased some investor concerns, the lack of stability in the cryptocurrency market is still a significant concern.

A Recent Panic Triggered by the Bitcoin Cash Hard Fork and Resulting Drama

Analysts have also weighed in to state how they believe the Bitcoin Cash hard fork, which happened on August 1, 2017, set the stage for the 2018 crash by causing bickering between the two crypto communities associated with Bitcoin and Bitcoin Cash. The hard fork caused an initial drop in Bitcoin’s value, partially driven by the negativity surrounding the event. A technical selloff occurred after the fork, followed by full-blown capitulation after that.

The technical selloff and capitulation have defined many of the discussions about Bitcoin’s crash, especially over the past six weeks or so.

Even long-term holders of Bitcoin have started to decide it’s time to sell. Bitcoin’s price dropped 36 percent in November 2018 alone. However, some people are still confident that the cryptocurrency will bounce back — as it has before, after other substantial drops.

Is the Bubble Bursting?

Opponents of cryptocurrency suggest the bubble has already burst. They compare the current situation to the “dot-com” bubble of the late ’90s and early 2000s, which bankrupted countless IT entrepreneurs. But experts in the field disagree. According to Angel Versetti, CEO of Ambrosus, the cryptocurrency bubble hasn’t even begun.

Matthew Newton, a top analyst with the online investment platform eToro, suggests it’s far too early to determine whether there is a bubble and if it has already burst. But he was also quick to point out the formation of a cryptocurrency bubble is an inevitable step in the processes of evolution and maturation.

Where Do We Go From Here?

There isn’t a failsafe method for keeping cryptocurrency alive. Instead, it will take a concentrated effort from investors, consumers and retailers alike. Not long ago, the value of Bitcoin was struggling to top $1, so it’s still come a long way in a short time. Additionally, there have been some key developments — despite the recent setbacks — that show great potential for the future.

The big challenge for investors moving forward is navigating between the short-term risks and long-term potential of digital assets. The apparent bursting of the asset bubble in 2018 exposed an overbought market that had risen too frantically for the fundamentals to support. But the pullback hasn’t weakened the value proposition of Bitcoin or other leading cryptocurrencies. As we’ll see over the next six months, topics ranging from institutional adoption to business innovation will dominate the headlines as the market continues its evolution.

Featured image courtesy of Shutterstock. 

Important: Never invest (trade with) money you can't afford to comfortably lose. Always do your own research and due diligence before placing a trade. Read our Terms & Conditions here. Trade recommendations and analysis are written by our analysts which might have different opinions. Read my 6 Golden Steps to Financial Freedom here. Best regards, Jonas Borchgrevink.

Rate this post:

Important for improving the service. Please add a comment in the comment field below explaining what you rated and why you gave it that rate. Failed Trade Recommendations should not be rated as that is considered a failure either way.
4 votes, average: 5.00 out of 54 votes, average: 5.00 out of 54 votes, average: 5.00 out of 54 votes, average: 5.00 out of 54 votes, average: 5.00 out of 5 (4 votes, average: 5.00 out of 5)
You need to be a registered member to rate this.
Loading...

5 stars on average, based on 1 rated postsKayla Matthews has been a technology and productivity journalist for over 7 years contributing to publications such as MakeUseOf, The Next Web, VentureBeat and Cointelegraph. She's also the editor of her tech blog, Productivity Bytes, where she writes everything from how-tos to the latest news in technology. To see more of her work, subscribe to Hacked.com or follow her on Twitter @KaylaEMatthews.




Feedback or Requests?

Continue Reading

Altcoins

Stellar Price Analysis: XLM/USD Has the Potential for a Short-term Rally, Though Bearish Set-up Eyed

Published

on

  • Stellar’s XLM potentially has further room for upside, within the short-term view.
  • Danger still looms for XLM/USD, as the daily chart suggests of a bearish technical pattern set up.

Steller’s native token XLM, has failed to commit to any sustained trend. This has been the case since the start of July. Bull rallies that have been witnessed were quickly sold by the market bears. This led the market to trade within a generally long running form of consolidation. Price action is narrowing, given the unsustainable short-term trend runs that have been witnessed. It comes as somewhat of a surprise, as the Stellar foundation have certainly been busy.

Stellar Developments

It was reported recently, blockchain security company BitGo, announced their support of Stellar Lumens (XLM). Being added to the BitGo’s list, Stellar now receives custody solutions. Their users will be able to generate wallets for Stellar Lumens. This is said to be starting at some point within the next couple of weeks. Elsewhere, as previously reported, the Stellar foundation at the start of this month released their heavily anticipated decentralized exchange, StellarX.

4-hour Chart Technical Review

XLM/USD 4-hour chart

Looking via the 4-hour chart, price action has formed a bullish pennant pattern. This comes after the surge higher between September 20-23. XLM/USD has since entered consolidation mode, trading within a range-bound nature. The price is coming very much towards the end of this technical pattern seen, raising the case for an imminent breakout. Near-term support can be observed around $0.2350 area. This is the lower tracking trend line of the mentioned pennant. A failure of the support could very likely see a fast fall to $0.2050. XLM/USD was last trading in this territory between September 12 – 20. The mentioned period was during a time of consolidation, prior to the mentioned breakout higher.

Resistance is seen just ahead of the current price. The above descending trend line of the pennant pattern is tracking around $0.2460-70. Enough bullish momentum to see the breach would likely force the price running to $0.2650. This is seen as an area of resistance on the 4-hour chart view. Looking further to the north, eyes would be on the supply heading into the $0.3000 mark.

Daily Chart Technical Review

XLM/USD daily chart

Taking into consideration the 4-hour chart view, there is still room for another squeeze higher. Despite this, danger appears to still be looming for XLM/USD. Risks on the daily chart point to the downside. The view of this is that a longer-term bearish pennant pattern is containing the price. XLM/USD support on the daily chart can be seen just sub of $0.2000. A long-running supporting trend line can be seen. The price having required assistance on June 29 and several occasions from September 8 – 12. To the upside, resistance can be seen around $0.2900. XLM/USD was rejected already on a few prior occasions, by the above descending trend line. July 25-2 and then most recently September 23, all saw respective bull runs halted.

Disclaimer: The author owns bitcoin, Ethereum and other cryptocurrencies. He holds investment positions in the coins, but does not engage in short-term or day-trading.

Featured image courtesy of Shutterstock.

Important: Never invest (trade with) money you can't afford to comfortably lose. Always do your own research and due diligence before placing a trade. Read our Terms & Conditions here. Trade recommendations and analysis are written by our analysts which might have different opinions. Read my 6 Golden Steps to Financial Freedom here. Best regards, Jonas Borchgrevink.

Rate this post:

Important for improving the service. Please add a comment in the comment field below explaining what you rated and why you gave it that rate. Failed Trade Recommendations should not be rated as that is considered a failure either way.
3 votes, average: 5.00 out of 53 votes, average: 5.00 out of 53 votes, average: 5.00 out of 53 votes, average: 5.00 out of 53 votes, average: 5.00 out of 5 (3 votes, average: 5.00 out of 5)
You need to be a registered member to rate this.
Loading...

4.6 stars on average, based on 112 rated postsKen has over 8 years exposure to the financial markets. During a large part of his career, he worked as an analyst, covering a variety of asset classes; forex, fixed income, commodities, equities and cryptocurrencies. Ken has gone on to become a regular contributor across several large news and analysis outlets.




Feedback or Requests?

Continue Reading

Altcoins

Bitcoin Cash Price Analysis: When is BCH/USD Taking Another Extended Move Higher?

Published

on

  • The Bitcoin Cash price behavior suggests another imminent breakout is likely. Upside surprises appear move likely than any potential downside breakouts.
  • BCH/USD continues to move within a bullish pennant pattern formation. Narrowing price action indicates a breach is near.

The Bitcoin Cash price after the huge surge to the upside on 26th September, attributed to the Bitmain IPO news, has remained elevated. Risks appear tilted to the upside, given current price behavior and technical patterns observed. Outside of the technical view, news flow and updates have remained positive around Bitcoin Cash.

News Flow Remains Positive

Bitcoin Cash adoption continues to take place. It was reported that the events ticketing company, Bigtickets.com, has expanded its payment options, with acceptance of cryptocurrency. Customers will be able to pay using Bitcoin Cash. The CTO said “We know our dedication to innovation is deserving of a secure and seamless purchase method for our event attendees. The use of Bitcoin Cash is a major social trend we’ve been following. Therefore, we’re excited to be one of the first event ticketing platforms in the United States to accept the burgeoning cryptocurrency,”

Elsewhere, earlier in the week, TD Ameritrade, announced it is investing in a cryptocurrency exchange platform, ErisX. This will be facilitating a range of products, including crypto futures contracts. Fortunately for Bitcoin Cash, it has earned its way into the top 4 cryptocurrencies by market cap. Given its status, Bitcoin Cash will be one of the crypto futures products offered by ErisX.

This follows news back in August, Crypto Facilities announcing a Bitcoin Cash futures product. Crypto Facilities are regulated by the UK Financial Conduct Authority (FCA). The move came given Bitcoin Cash has a growing presence and acknowledgement across the market. The introduction of Bitcoin Cash futures is joining the company’s other crypto-based products.

Near-term Analysis (60-minute chart)

Eyes are locked on BCH/USD movement within a bullish pennant pattern formation. Price action is well-supported by the lower trend line. It for now remains within consolidation mode, after the strong surge on 26th September. The price is moving towards the end of the pattern, into a narrower range. This behavior suggests a breakout could very much be imminent, subject to bullish momentum.

BCH/USD 60-minute chart

Resistance to the upside is seen at the above trend line of the pennant, $523. Given the pole of the mentioned pattern, the breakout may be chunky. A retest of the supply around $640-$660, will therefore be the likely first target area. The price last traded in this region from the 1st to the 4th September. Support is eyed around $510-509, as mentioned above, the lower trend line of the pennant.

Disclaimer: The author owns bitcoin, Ethereum and other cryptocurrencies. He holds investment positions in the coins, but does not engage in short-term or day-trading.

Featured image courtesy of Shutterstock.

Important: Never invest (trade with) money you can't afford to comfortably lose. Always do your own research and due diligence before placing a trade. Read our Terms & Conditions here. Trade recommendations and analysis are written by our analysts which might have different opinions. Read my 6 Golden Steps to Financial Freedom here. Best regards, Jonas Borchgrevink.

Rate this post:

Important for improving the service. Please add a comment in the comment field below explaining what you rated and why you gave it that rate. Failed Trade Recommendations should not be rated as that is considered a failure either way.
1 vote, average: 5.00 out of 51 vote, average: 5.00 out of 51 vote, average: 5.00 out of 51 vote, average: 5.00 out of 51 vote, average: 5.00 out of 5 (1 votes, average: 5.00 out of 5)
You need to be a registered member to rate this.
Loading...

4.6 stars on average, based on 112 rated postsKen has over 8 years exposure to the financial markets. During a large part of his career, he worked as an analyst, covering a variety of asset classes; forex, fixed income, commodities, equities and cryptocurrencies. Ken has gone on to become a regular contributor across several large news and analysis outlets.




Feedback or Requests?

Continue Reading

Recent Posts

A part of CCN

Hacked.com is Neutral and Unbiased

Hacked.com and its team members have pledged to reject any form of advertisement or sponsorships from 3rd parties. We will always be neutral and we strive towards a fully unbiased view on all topics. Whenever an author has a conflicting interest, that should be clearly stated in the post itself with a disclaimer. If you suspect that one of our team members are biased, please notify me immediately at jonas.borchgrevink(at)hacked.com.

Trending