Friday, 7th September, saw Steve D’Antuono, the FBI Chief of Financial Crimes, speak to CNBC about the rampant scams in the cryptocurrency industry and how fiat currency still rules the roost when it comes to fraudulent transactions.
The Federal Bureau of Investigation officer went on to speak about how there has been a severe uptake in terms of crimes and frauds in the cryptosphere. According to D’Antuono, the spike in the activities have not really been accounted for in terms of percentage but the severity of the issues has made a lot of government bodies stand up and take note. Just a few weeks back, the FBI had reported that the organization was investigating over 130 cryptocurrency related cases.
To keep up with the incessant crime rate, the FBI had also asked for a funding of 21.6 million to combat cybercrimes, especially niches like cryptocurrency and digital assets. One major milestone that the FBI had achieved was in late June 2018, when the investigative agency was able to seize over 2000 Bitcoin [BTC] amounting to over $20 million.
Steve D’Antuono went on to say that the two main influxes of crimes were the dark web and Initial Coin Offerings [ICO] with a focus on Ponzi schemes. Just a week back Chinese media had reported that a hacker was in the business of selling personal details of hotel guests on the infamous Dark web for 8 BTC. This news came in the wake of China’s iron hand on cryptocurrencies, with the country heading towards a digital asset ban.
ICOs have been in the bad books of regulators for a long time, with their case not being supported when The Wall Street Journal had reported a few months back that out of the 1450 ICOs existing then, over a staggering 271 were scams or obvious frauds.
D’Antuono also stated that the big Bitcoin 20k boom of late 2017 acted as a catalyst for fraudsters, seeing a significant increase proportional to the growing interest in cryptocurrencies after that event. The FBI official was also frank in admitting that the Securities and Exchange Commission were doing everything in their part to ensure the safety and security of the financial markets.
This comment was a direct reflection of what Valerie A. Szczepanik, the Senior Advisor of Digital Assets and Innovation at the SEC, said during the ongoing TechCrunch Disrupt conference in San Francisco. Valerie had stated that the United Stated SEC was leading in terms of cryptocurrency regulations compared to many other bodies. She also added:
“We are actively engaging with entrepreneurs and practitioners through these meeting in a way that we’ve never seen before at the commission, it’s really an open door policy”
As the discussion with the FBI official continued, Steve D’Antuono assured that the FBI would do what it takes to protect users and strike down om criminals. According to him:
“These crimes will be stopped. It is just like the invention of the computer some 20 years back. A lot of us did not have any idea how to deal with cybercrimes then but we learned and adapted. That’s what is happening right now, we are slowly assembling the jigsaw to quash all cryptocurrency related crimes.”
D’Antuono also added that at the end of the day, criminals still need fiat currency because they will convert the illegal digital assets back to cash for transactions, a step that makes it easier for organizations like the FBI to clamp down on shady activities.