“Golden interest” or a costly trap? The whole truth about cryptocurbs

Cybercriminals love cryptocurrencies – right or false? The mythical land of cryptocurrencies tempts with spectacular profits. The more mythical, the more dangerous. Because faith in myth costs dearly. Cryptocyarists do not know mercy, and the promised “golden interests” in the blink of an eye are devastating the accounts of the victims. About how cybercriminals use cryptocurrencies, who is most exposed to their attack and who should protect us, I talk to Michał Królik, senior Cryptocurrency Analyst in MediaCovery.

Beata Anna Święcicka “Wprost”: Let’s start our conversation with the myths that circulate around cryptocurrencies, or more precisely their anonymity. Is it really possible to remain invisible in blockchain networks?

Michał Królik, Senior Cryptocurrency Analyst at MediaCovery: The biggest myths is the belief in full anonymity in the world of cryptocurrencies. Indeed, transactions in many networks are not directly related to the name of the user, but this does not mean that they remain invisible. Most blockchains act based on the principle of full transparency, which means that transactions regarding a given address are to be traced. Whether you manage to link the address with a specific person depends on many factors, including how the user uses stock exchanges, wallets or additional services, and the knowledge of the person analyzing a specific case.

Modern analytical tools can combine this information and in many cases lead to identification. That is why we should not talk about anonymity, but rather about pseudonym, which gives the appearance of privacy, but does not guarantee it one hundred percent.

Can an ordinary user also track cryptocurrency transactions, or is it just the domain of analytics experts?

Basic tracking can be done without access to commercial tools – a lot of patience and knowledge of basic heuristics are enough. The problem is that manually combining addresses quickly becomes a tangle of hundreds of operations, and every error in interpretation, such as confusion of the residual address or not recognizing the place of payment of funds for some entity dealing with the exchange of cryptocurrencies, leads to a false trail. Without professional tools, it is harder and sometimes even impossible to track means when the perpetrator uses anonimization methods, such as mixers.

To sum up: you can, but it requires much more time and knowledge, and the margin of mistakes increases with each subsequent chain transaction.

What does the scale of crime using cryptocurrencies look like – is growing, or is it constant?

Cryptocurrencies are still not the main currency of financial criminals, but their growing popularity translates into a larger number of matters. According to chainalysis (chainalysis crime report 2024), only 0.14 percent all verified cryptocurrency transactions in 2024 were related to criminal activities, it is a decrease from 0.34 percent. in 2023

In the absolute values, the “crypto-capacity” volume increases with the detection of new addresses. Chainalysis already estimates USD 40.9 billion to illegal entities in 2024, and historically these numbers grow by about 25 percent. year to year when researchers identify subsequent criminal wallets. Despite this, the share of crypto in global financial crime is still clearly below 1 percent.

In short: the absolute number of incidents and amounts in dollars go up, because the crypto ecosystem increases, but the percentage share of criminal operations throughout the market is systematically decreasing. That is why we are talking about the growing percentage of cases in police statistics rather than about the dominance of cryptocurrencies as a tool of financial abuse.

How do criminals use cryptocurrencies? Can typical schemes be indicated in fraud with their use?

Most often, cryptocurrencies are used by criminals to hide funds and their flow between different wallets. Although blockchain is public, it does not show who actually stands behind a given portfolio, and this promotes money laundering or hiding income from crime.

Investment fraud is one of the most common scenarios. Criminals create false investment platforms and promote them, e.g. using advertising on the Internet. When the victim leaves the contact details, the fraudsters call and build trust step by step. They often urge you to install remote computer skills.

Later, an investment account is set up, sometimes on a real stock exchange, sometimes on a crafted page. The victim pays funds, and on the screen sees fictitious profits that encourage her to further pays. When he tries to withdraw money, various obstacles, commissions, taxes, calls from alleged lawyers appear.

At a later stage, fraudsters often impersonate law firms or assistance institutions and offer help in recovering funds, which leads to subsequent scams.

It is worth emphasizing that cryptocurrencies are used not only as a tool for transferring funds, but also as a lure, the promise of quick profits. Of course, there are legal investment platforms or offices that help victims of such fraud, but the victim should reach them himself, not the other way around.

Exactly. And we can catch this “profit promise”. In what environments of cybercrime using cryptocurrencies occur most often? Who is usually the victim of cryptosules?

My observations show that cybercriminals most often take the company from the production and logistics sector: the production line standing for a day means losses calculated in millions, which makes it easier to force quick payment in Bitcoin.

In the world of individual users, two scenarios dominate: “pig-buttering”, i.e. false investment platforms promising quick profits, and romance-we scratch on dating applications, where criminals build trust and then ask for transfers in crypto.

The most technical arena of attacks are DEFI, NFT and Mosty Cross-Chain projects, where rush in releasing new smart-control leads to cod gaps and spectacular theft of funds.

The common denominator of all these incidents is the combination of time pressure, knowledge disproportion and irreversibility of cryptocurrency transactions.

What do Polish officers and investigators have about cryptocurrencies? Is it enough to effectively deal with network crime and track illegal transactions?

There is an increasing involvement in education about cryptocurrencies among services, especially in central units. Good, more and more advanced training on blockchain analysis and transaction tracking are created. The problem is that they are still not available on a large scale. In many local units, the level of knowledge can be limited, and officers often do not have tools or practical skills to work efficiently in matters with a cryptocurrency thread.

The prosecution of this type of crime is not only a police domain. Who else deals with detection of cryptocurrencies?

These types of matters are also increasingly concerned with officers of the National Tax Administration, Border Guard, Military Police, the Central Anti -Corruption Bureau or the Internal Security Agency. Each of these services may come across a thread related to cryptocurrencies – e.g. in the context of smuggling, money laundering, corruption or financing of illegal activity.

Who, in addition to officers and law enforcement agencies, should have knowledge about blockchain analysis and tracking of cryptocurrency transactions?

First of all, representatives of the judiciary, in particular prosecutors and judges. For them, knowledge about cryptocurrencies can be crucial for proper understanding of evidence and making procedural decisions in matters in which digital assets appear. Without basic discernment in the functioning of portfolios, stock exchanges and blockchain flows, it is difficult to fully assess the nature and importance of some accused or victims.

Legal office cannot be omitted either. Lawyers are increasingly representing clients who are victims of fraud or participants in cryptocurrency trading, so they should be able to recognize the patterns of criminals, understand transactions and prepare appropriate legal arguments.

Technical knowledge also becomes necessary for court experts who prepare opinions on the value of digital assets or their origin.

And in business – which professional groups need such competences?

In the business sector, compliance specialists (Compliance) and counteracting money laundering play a key role, especially those working in banks, payment institutions and cryptocurrency exchanges. They are responsible for monitoring transactions, detecting risky behaviors and reporting suspicious operations to relevant supervisory authorities. Lack of knowledge about the techniques of hiding funds on blockchain can lead to overlooking significant threats.

Knowledge of blockchain analysis is also necessary in the work of cyber security specialists, who are increasingly encountering ransomware, phishing, malware or theft of funds from cryptocurrency portfolios.

The ability to track digital traces on blockchain allows for faster response to incidents, securing traces and more effective identification of the perpetrators. For similar reasons, this knowledge is also useful to private detectives and independent digital analysts who support victims of investment fraud.

Finally, also companies operating in the e-commerce sector, auditors or tax advisors who are increasingly coming in contact with cryptocurrencies. They should not only be able to accept such payments, but also understand their source, compliance with tax regulations and the method of documenting them as part of their business. That is why knowledge of blockchain analysis becomes a cross -sectional competence necessary in many professions of the modern digital world.

At this point, it is also worth mentioning the role of education. Higher universities, research institutes and technological laboratories have to play an important role in training future specialists and in developing tools for blockchain analysis. Thanks to cooperation with the public and private sectors, they can create solutions that will support both prosecution of crime and honest economic turnover.

Thank you for the interview.

Bio – Michał Królik, Senior Cryptocurrency Analyst in MediaCovery. At MediaRecovery, he is an expert on cryptocurrency transaction analysis. He is responsible for the program and conducting training in the series “Cryptocurrencies and Blockchain analysis” as part of the MediaRecovery Investigation Academy. He advises interested entities on the selection and use of tools for blockchain analysis and tracking cryptocurrency transactions. Michał Królik is a former officer of the board in Krakow CBZC. Has international certificates, including TRM, Chainalysis, Europol, FBI. He is a co -creator of cryptocurrency protection procedures in Poland and Europol. Since 2017, he has shapes the national practice of blockchain analysis and supports the development of investigative competences.