Authorities Shut Down Cryptocurrency Laundering Service

Dutch police have shut down Bestmixer, a popular Bitcoin money laundering service on the dark web. 

The Dutch Fiscale inlichtingen- en opsporingsdienst anti-fraud agency (the Fiscal Information and Investigation Service, known as the FIOD), worked with the Public Prosecution Service to take offline. In collaboration with the Dutch Digital Intrusion Team (DIGIT), Europol and the authorities in Luxembourg, France and Latvia, they sized six servers in the Netherlands and Luxembourg. 

The investigation, launched after a report from McAfee, sees the end of one of the dark web's top three bitcoin mixing services, dealing a blow to cryptocurrency money launderers around the world.

Bitcoin's blockchain makes the creation and transfer of bitcoins transparent. Although the blockchain doesn't register bitcoin holders' identities, you can use a blockchain explorer to track a bitcoin's entire lifecycle, documenting all the addresses that it passes through. This makes it possible for analysts to conduct forensic investigations, spotting connections between entities on the blockchain that can provide valuable clues when looking into crimes. 

Bitcoin mixing services are supposed to disrupt that process by 'laundering' bitcoins so that others cannot trace them. They take bitcoins sent by users and blend them with many other users' bitcoins. They then send untraceable digital currency back to the original users, minus a fee. 

Founded in May 2018, Bestmixer allegedly mixed at least $200m in bitcoins, according to the FIOD, comprising around a quarter of the dark web's $800m annual turnover. It also laundered the litecoin and bitcoin cash currencies. 

This is the second big win for Dutch authorities in the cryptocurrency space this month. FIOD previously announced the arrest of a 33 year-old man accused of fraudulently selling bitcoin mining resources. The perpetrator spent over €2m in illicitly-obtained funds on luxury goods, authorities said.

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