Crypto is “easily” traceable – Michael Gromek
- Gromek says illegal transactions in the crypto space are still negligible
- Criminals can be easily traced and punished
- THORN Price at time of writing – $5.47
Because transactions can be traced, Michael Gromek, co-chair of the Global Coalition to Fight Financial Crimes Digital Asset Task Force committee, believes that cryptocurrencies are not a safe haven for criminals.
During an interview with Kitco News at the Future Blockchain Summit in Dubai, Gromek made the statement. He stated that it is not true to conduct transactions on the blockchain with the expectation of escape and impunity.
Gromek’s advice to investors
It is not smart to transact on the blockchain using pseudo-anonymous currencies because most suspects are easily traceable.
Gromek revealed that the Digital Assets Task Force is able to identify criminals by working on the exchange of Know Your Customer (KYC) data and implementing anti-money laundering (AML) regulations, citing reports indicating that illegal activities on the blockchain constitute only 0.15 percent of all transactions.
The financial crime consultant went on to say that even so-called “privacy coins” like Monero (XMR), which use intricate codes to hide wallet addresses, can be tracked by authorities.
Gromek’s advice to investors According to Gromek, investors must still be on the lookout for fraudsters and scammers to avoid falling victim to them.
Working only with trading venues that comply with the regulations in their jurisdiction and assessing risk before investing in a project are two methods of achieving this.
His revelation comes after a number of privacy coins have recently fallen foul of regulators.
In September, cryptocurrency exchange Huobi Global delisted DASH, XMR, ZEC, ZEN and a few other privacy coins.
Similarly, the popular privacy tool Tornado Cash, which is based on Ethereum, was banned by the Office of Foreign Assets Control (OFAC) of the US Treasury for facilitating money laundering transactions, especially for hackers linked to North Korea.
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What is special about Tornado Cash?
Tornado Cash runs self-executable code and requires no permissions. The developers destroyed their management keys in May 2020, preventing them from viewing or modifying transactions taking place on their protocol.
The group argues that financial privacy is essential to freedom, and that, aside from publishing code to GitHub, they don’t have much control over the protocol.
According to co-founder Roman Semenov, the cryptographic method (MPC) used to destroy their admin keys makes Tornado Cash transactions trustless and completely unstoppable.
The protocol has been cited as a vehicle for money laundering and is often criticized for its use by hackers, who can store their stolen funds there. Although the protocol is kept very secret, some have argued that if there is a large deposit and little liquidity, it may be possible to track transactions.
Andrew is a blockchain developer who developed his interest in cryptocurrencies while graduating. A keen observer of detail, he shares his passion for writing alongside being a developer. His backend knowledge of blockchain helps him bring a unique perspective to his writing
