Jul 23, 2024 12:25
The use ofcryptocurrencies in various criminal activities has become increasinglyprevalent, according to Europol's latest Internet Organised Crime ThreatAssessment (IOCTA) report released today (Monday). The European Union's lawenforcement agency highlights the growing role of digital assets and artificialintelligence in cybercrime, signaling potential challenges for investigatorsand regulators alike.
Cryptocurrencies FuelCybercrime Surge, Europol Warns in Latest Threat Assessment
In its 10thannual IOCTA report, Europol emphasizes that cryptocurrency adoption amongcybercriminals has expanded beyond traditional use cases, permeating a widerarray of illicit activities. This trend poses significant concerns for lawenforcement agencies struggling to keep pace with rapidly evolving criminaltactics.
In 2023,millions of victims across the EU were attacked and exploited online on a dailybasis. Small and medium businesses were increasingly popular targets forcyber-attacks, while e-merchants experienced the most digital skimming attacks,commented Catherine De Bolle, the Executive Director of Europol. Adults were victimizedthrough phishing, investment and romance frauds, and more and more minors weretargeted by child sexual exploitation offenders and online sexual extorters
The reportspecifically points to the potential abuse of emerging financial products tiedto cryptocurrencies. As it suggests, the introduction of Bitcoinexchange-traded funds (ETFs) has allowed a much larger group of investors tospeculate on cryptocurrencies without the need to physically possess them.
Scammerscould abuse the rise of ETFs related to cryptocurrencies as people who do nothave extensive experience in cryptocurrency will become increasingly exposed tothem, commented Europol. Companies issuing cryptocurrency ETFs will also haveto hold large reserves in cryptocurrency, which might make them valuabletargets for fraudsters.
Europol'sfindings come amid a backdrop of fragmentation in the cybercrime landscape.Recent law enforcement actions have forced ransomware groups to splinter andrebrand, while continuous takedowns of dark web forums have shortened thelifecycle of criminal online marketplaces. This instability has contributed toa multiplication of cyber threats, with millions of EU citizens falling victimto online attacks daily.
#Internet Organised Crime Threat Assessment (IOCTA) 2024 #Cyberattack #CyberSecurity #cybercrime https://t.co/eWOuB6YXJQ
Shadi Alkasim (@Shadi_Alkasim)
July 22, 2024Europol actively pursues crimes involving cryptocurrencies.A recent incident in May led to the arrest of six individuals and the recoveryof 750,000 from a cryptocurrency scam. Last year, the agency also warned aboutcrimes using DeFi and NFT technologies, though it supports the use of blockchain in enhancingcybersecurity. Three years ago, Europol dismantled a criminal group responsible for stealing $100 million in cryptocurrencies.
Artificial IntelligenceHelps Scammers
The reportalso sheds light on the evolving nature of cybercrime tactics. Multi-layeredextortion schemes have become more common, with stolen data at risk of beingpublished or auctioned, leading to potential re-victimization. Additionally,the assessment notes a concerning trend of underage offenders engaging incybercriminal activities, some of whom are already leveraging artificialintelligence (AI) tools.
Cybercriminalsare keen to leverage Artificial Intelligence, which is already becoming acommon component in their toolbox and is very likely to see even widerapplication. Law enforcement agencies are expected to build a robust capacityto counter the growing threats stemming from this, both in terms of humanresources and technical skills, added De Bolle.
Lookingahead, Europol anticipates that AI-assisted cybercrime will pose growingchallenges, particularly in the realm of child sexual abuse material (CSAM).The agency warns that AI-altered and completely artificial CSAM will complicateinvestigations, making it harder to identify victims and perpetrators.
A reportfrom Finance Magnates this April indicated that nearly 50% of companies aretargeted by AI-generated deepfakes. The payment, money transfer, and personalbanking sectors are particularly vulnerable to cybercrime in this regard. Asscammers increasingly utilize AI for malicious purposes, companies likeMastercard are employing this technology to shield consumers from fraud,especially significant as the annual cost of cybercrime is projected to reach$10.5 trillion next year.
What to Expect in the NearFuture
Based onthe information provided in the IOCTA 2024 report, there are 7 key developmentsto expect in the near future regarding cybercrime and digital threats:
- IncreasedAI-assisted cybercrime: AI tools are becoming more prevalent in criminals' toolboxes, with aparticular concern for AI-assisted creation of child sexual abuse material(CSAM).
- Rise inAI-altered and artificial CSAM: This trend will pose growing challenges for law enforcement inidentifying victims and offenders, as well as managing the increased volume ofCSAM in circulation.
- Expandeduse of cryptocurrencies in various crime areas: Digital assets are expected to play a moresignificant role across a wider spectrum of criminal activities.
- Potentialabuse of cryptocurrency-related financial products: The report warns that scammers could exploitthe rise of exchange-traded funds (ETFs) tied to cryptocurrencies.
- Continuedfragmentation of cyber threats: Due to law enforcement actions and market instability, cybercriminalgroups are likely to continue splintering and rebranding, leading to amultiplication of threats.
- Increaseduse of multi-layered extortion tactics: Criminals are expected to continue employingcomplex extortion schemes, including the threat of publishing or auctioningstolen data.
- Growingchallenges related to end-to-end encryption (E2EE): The widespread use of E2EE communicationplatforms by offenders will create ongoing difficulties for law enforcement inaccessing criminal communications.
To addressthese mounting digital challenges, Europol emphasizes the need for lawenforcement agencies to stay ahead of the curve. The agency calls for enhancedknowledge, tools, and legislation to effectively combat evolving cyber threats.
The IOCTA2024 report serves as a reminder of the dynamic nature of cybercrime and thecritical role that cryptocurrencies now play in this landscape. As digitalassets continue to gain mainstream acceptance, the challenge for lawenforcement to balance innovation with security becomes increasingly complex.
This article was written by Damian Chmiel at www.financemagnates.com.
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