Over the last year, a surge in cryptocurrency funding has reshaped the face of international finance. Despite stringent US and global sanctions, Russian military fundraising entities raked in an astonishing amount through cryptocurrencies. Initial estimations counted Russia’s crypto-accumulation at about $4.2 million, dwarfed by Ukraine’s massive $212 million. Yet, a subsequent study by renowned blockchain analytics company Elliptic indicates that Russia might have gathered nearly $20 million in digital currency.
IRS’s Pioneering Initiative with Global Allies
Remarkably, US-sanctioned bodies contributed to over 50% of these funds. Astoundingly, a dominant 80% of these digital assets coursed through mainstream cryptocurrency exchanges. These groups didn’t stop there; they also ventured into decentralized finance (DeFi) platforms, took advantage of NFT services, and utilized decentralized exchanges. Beyond this, select individuals and factions have transitioned to cryptocurrency for their financial endeavors, some even championing NFT initiatives supporting military campaigns.
The IRS Criminal Investigation (CI) recently unveiled a landmark initiative in light of the pressing need to address this issue. In partnership with international agencies, they set out to enhance the capabilities of Ukrainian law enforcement in understanding and tracing cryptocurrency and blockchain transactions.
Their previous stint in May saw CI delivering a successful cyber training program to Ukrainian officers. Amplifying this momentum, they joined forces with the Dutch Fiscal Information and Investigation Service (FIOD) and His Majesty’s Revenue and Customs (HMRC) from the UK. From September 18th to 21st, these entities orchestrated an in-depth online training program, targeting almost 40 Ukrainian officers.
A Deep Dive into the Cryptocurrency Training Program
A collaborative effort, the CI, FIOD, and HMRC enlisted the expertise of blockchain analytics giants, CipherTrace and BlockTrace. The intensive curriculum included a wide spectrum of officers from several Ukrainian law enforcement branches, like the Cyber-Police Department, the Economic Security Bureau, the National Anti-Corruption Bureau, and Ukraine’s State Bureau of Investigation.
Subjects ranged from combatting money laundering and discerning counterfeit cryptocurrency deals to refining skills in blockchain forensics. Completing the course and its final assessment, trainees received the coveted Cryptocurrency Tracing Certified Examiners (CTCE) title.
Jim Lee, CI Chief, highlighted the role of such alliances in his statement, emphasizing, “The trainings echo the paramount importance of collaborations between public and private sectors. Our global endeavors with Ukrainian counterparts epitomize our collective mission against sanction dodgers.”
Another Step For Ukrainian Law Enforcement
The CI’s prior venture into this domain saw them working closely with Chainalysis, a leading blockchain intelligence platform. Their main aim? To pinpoint and disrupt financial infrastructures where individuals masked assets in breach of sanctions.
This forward momentum in the fight against cybercrime marks a promising stride, emphasizing global cooperation and the critical importance of equipping law enforcement with the right tools.
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