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Over $900K in Bitcoin Went to Child Sexual Abuse Material Providers in 2019, Says Chainalysis

New York-based blockchain intelligence agency Chainalysis has printed its newest evaluation of the usage of cryptocurrencies to buy baby sexual abuse materials (CSAM) on the darknet.

In a report shared with Cointelegraph on April 22, Chainlaysis famous that it had traced just below $930,000 value of Bitcoin (BTC) funds to addresses related to CSAM suppliers in 2019. This represents a 32% enhance over 2018, which had in flip offered a 212% enhance over the earlier 12 months.

Bitcoin (BTC) funds to CSAM suppliers, 2015-2020. Supply: Chainalysis

Nonetheless, Chainalysis emphasised that this stark year-on-year rise just isn’t essentially reflective of an absolute rise in CSAM demand, however is prone to mirror an increase within the stage of adoption of cryptocurrencies throughout all sectors.

The best way to decode the warning indicators

$930,000 in Bitcoin represents “a miniscule fraction of all cryptocurrency exercise” — and but the business needs to be involved about such utilization of cryptocurrencies in a felony and deeply exploitative business, Chainalysis says.

Whereas cryptocurrencies might have grow to be prevalent amongst felony content material suppliers as a result of their perceived pseudonymous properties, Chainalysis notes that the blockchain can actually present investigators with actionable information that sheds mild on the profiles and actions of these concerned.

Among the many key patterns recognized within the report are frequent low-value funds — sometimes between $10 and $50 in Bitcoin — despatched between 11pm and 5am. Whereas small funds account for the lion’s share of transactions, CSAM suppliers do draw a major share of their income from a lot bigger particular person funds. 

Different indicators of illicit CSAM exercise embody cryptocurrency transactions which are tied to pay as you go credit score and debit playing cards, or these made repeatedly to 1 handle (or group of addresses managed by the identical entity). 

Crypto funds to identified escort companies or different grownup companies suppliers or the acquisition of crypto tokens that concentrate on the grownup business particularly can present regulation enforcement with additional information factors in direction of an evaluation of the CSAM darknet sector.

The Backpage backstory

As Cointelegraph has reported, listings website Backpage — described as “the world’s largest brothel” —  was seized by the USA Division of Justice in 2018. 

CEO Carl Ferrer later pleaded responsible to conspiracy and three counts of money-laundering, partially by way of cryptocurrencies, admitting he had been conscious that the “nice majority” of the location’s adverts have been for prostitution companies. 

Ferrer had laundered $500 million in income by means of a number of financial institution accounts and websites that included Coinbase, GoCoin, Paxful and Kraken, amongst others.

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