Navigating the Crypto Landscape: Exploring the Risks and Potential Misuse of Crypto Assets in Money Laundering

Abstract

Background: The issue with cryptocurrency lies in its anonymous or pseudo-anonymous characteristics, which create obstacles or difficulties in tracing wealth that is converted into cryptocurrency assets. This results in opportunities for money laundering through cryptocurrency assets.

Methodology: This study is normative research that employs a dual approach, incorporating both legislative analysis and conceptual frameworks to examine the subject matter.

Objectives: This paper aims to address the risks of cryptocurrency asset misuse in money laundering crimes and the potential for committing money laundering through the misuse of cryptocurrency assets.

Findings: Cryptocurrency misuse in money laundering can be identified through mapping threats, vulnerabilities, and impacts, indicating money laundering risks. Money laundering can occur by exploiting cryptocurrency’s anonymous characteristics or using nominees in transactions. Additionally, laundering is possible when receiving cryptocurrency accounts containing concealed crime proceeds, provided the receiver knows or suspects the account's criminal origin.

Originality/Novelty: While another research on money laundering focusing on combating the crime, this research introduces the new potential of money laundering through the utilization the current technology, which is cryptocurrency.