Topic: Basics of cyber security; money laundering and its prevention.
5. How can Cryptocurrency be used for money laundering? Discuss and suggest measures to curb the unlawful use of crypto currency. (250 words)
Why the question:
Recently 132 countries attend 4th Global meet on criminal finances, the conference underlined the need to expand capabilities on ways to probe virtual assets and regulate virtual asset service providers to prevent money laundering. Thus the question.
Key Demand of the question:
Discuss how Cryptocurrency can be used for money laundering, Discuss and suggest measures to curb the unlawful use of crypto currency.
Discuss – This is an all-encompassing directive – you have to debate on paper by going through the details of the issues concerned by examining each one of them. You have to give reasons for both for and against arguments.
Structure of the answer:
Start with the definition of cryptocurrency.
Recent increases in the number and quality of investigations in the field of cryptocurrency-facilitated crime and subsequent money laundering means that law enforcement and other public entities are continuing to enhance their level of knowledge and expertise in this crime area.
Discuss in detail the interlinkages of cryptocurrency and crime. Give examples to justify the same.
Explain what needs to be done to overcome the problems posed by cryptocurrency and the money laundering supported thereof.
Suggest solutions like – capacity building measures on ways to probe virtual assets, establishing clear regulatory framework to prevent money laundering, adopting ‘follow the money’ strategies against criminal proceeds, strengthening information exchange to dismantle criminal networks, and exploiting new technologies in criminal finances investigations.
Conclude with way forward.