The United Kingdom’s National Crime Agency (NCA) wants regulations for the cryptocurrency mixing technologies that are often used by criminals for hiding ill-gotten cryptos and money laundering , Financial Times reported on Tuesday.
Though cryptocurrencies are decentralized, transactions processed with them (except for privacy coins) are openly available on blockchains. This allows anyone to check if a particular unit of cryptocurrency was used in some criminal activities in the past.
Decentralized crypto mixers, also known as CoinJoin, have become popular among criminals as they can disguise past transactions of any cryptocurrency unit, making it hard for the authorities to trace its links to crime. According to, the blockchain analytics company, Elliptic, 15 percent of all cryptocurrencies linked to crimes were sent to crypto mixers in 2021.
Transacting Billion of Dollars in Crypto
The popularity of crypto mixing services hit a peak in January 2021 as 65,000 BTC worth $2.5 billion, which was 0.35 percent of all monthly Bitcoin transactions, were transacted through them that month.
“They can be used to provide a ‘layering’ service, churning criminal cash, obscuring its origins and audit trail, similar to how a cash business might be used by criminals to legitimize cash through the banking system,” NCA’s Head of Financial Investigation, Gary Cathcart told the publication.
The British agency expects that the regulations would force cryptocurrency mixers to comply with the country’s money laundering regulations. They also need to carry out customer checks and ensure that the cryptocurrencies handled by them are not linked to any criminal activities.
Crypto mixers have been under authorities' radar for a while now. Back in 2019, the Dutch Fiscal Information and Investigation Service (FIOD), along with Europol and Luxembourg authorities, closed down the cryptocurrency mixing services of Bestmixer.io, which was one of the market leaders at the time. However, a number of crypto mixing services are still operating today.
