Chainalysis: Traditional money launderers are using cryptocurrencies to create a “massive money laundering infrastructure”

The Chainalysis report notes that traditional money launderers (criminals outside the cryptocurrency space) may also be moving their cash on-chain. Kim Grauer, head of research at Chainalysis, said traditional money launderers are beginning to use crypto networks to create a "large-scale money laundering infrastructure" to clean cash from non-crypto areas. These transfers do not originate from addresses associated with crypto scams, thefts, and ransomware attacks that Chainalysis has flagged on-chain. In contrast, such transactions are more opaque and come from wallets that are not considered illegal. These funds flow across blockchains to exchanges according to strategies that traditional financial compliance departments may flag. For example: splitting into integer parts that are just below the KYC reporting threshold and then putting them back together. Grauer added that most on-chain investigators have known that this situation has been a potential trouble spot for many years. However, she said that the July report was Chainalysis' first attempt to record the scale of the trend of such activity across the chain. The company found that the number is even orders of magnitude larger than the known base of illegal transactions. When analyzing all transfers sent to exchanges in 2024, it found an excess of transactions valued just below the $10,000 mark, which is the threshold at which KYC rules take effect. (CoinDesk)