In brief

  • The UK's National Crime Agency has released its annual assessment of serious organized crime.
  • When it comes to crypto, the NCA is worried about blackmail, sanctions, and dark web markets.

The UK’s National Crime Agency has said that widespread crypto adoption is helping criminals to flourish. 

“Criminal use of technology is increasing, and the use of crypto assets to launder money has increased across several crime types,” the NCA said in its annual National Strategic Assessment of Serious Organised Crime, published earlier this week. 

Crypto firms have to register with the Financial Conduct Authority (FCA) and submit annual financial crime reports. While mainstream adoption of crypto assets might be a good thing for those in the industry, the NCA is all too aware of the risks. 

“Broader adoption of crypto asset technology by mainstream financial services will potentially provide a larger market for criminal exploitation and movement of criminal funds,” the NCA said in its report.

Crypto and crime

The NCA said that cryptocurrencies can help people evade sanctions and can also facilitate blackmail.

The agency pointed to the largest blackmail inquiry ever conducted in the UK—an individual who contaminated baby food with metal shards and demanded over £1.4 million ($1.9 million) in Bitcoin.

The inquiry involved over 15 police forces, and after two years, led to the conviction of Nigel Wright, who was sentenced in 2020 to 14 years in prison. 

The NCA added that the COVID-19 pandemic has influenced and accelerated how criminals use technology. 

“During the UK lockdown, the routine use of crypto assets, for example Bitcoin, and the dark web to enable serious organised crime offending increased,” the NCA said. 

Last year, blockchain investigations firm Chainalysis reported that dark web markets brought in more revenue in 2020 than in any previous year. That revenue was generated by several cryptocurrencies, including Bitcoin.