The German government has recently closed down 47 cryptocurrency exchanges, alleging that these platforms knowingly facilitated an “underground economy” for cybercriminal activities. Attention is now shifting to the users of these exchanges, many of whom may have engaged in criminal behavior.
In a statement released on September 19, Germany’s federal criminal police, alongside Frankfurt’s main prosecutor’s office and the national cybercrime authority, claimed that these exchanges had “deliberately concealed the origins of criminally acquired funds on a significant scale” by failing to properly implement legal measures aimed at combating money laundering.
The authorities assert that among the users of these exchanges are ransomware operators, botnet controllers, and black market traders who utilize the services to convert illicitly obtained funds into more conventional currency.
The websites of the confiscated cryptocurrency exchanges now display a stark warning from the German government. The notice reads: “We have located and seized their servers—development, production, and backup servers. We possess their data, and consequently, we have your data: transactions, registration details, and IP addresses,” according to the authorities.
Germany’s warning statement to users of the seized cryptocurrency exchanges. Source: German government
However, the German authorities cautioned that widespread prosecutions may be challenging, as many offenders operate from outside the country. “Cybercriminals frequently reside abroad and may be tolerated or even sheltered by some nations, making them elusive to German law enforcement,” they noted.
Among the seized exchanges, Xchange.cash reportedly operated since 2012 and facilitated nearly 1.3 million transactions for approximately 410,000 users. Other platforms that were seized include 60cek.org, Baksman.com, and Prostocash.com, all of which boasted substantial user bases and transaction volumes.
Details of eight out of the 47 cryptocurrency exchanges seized by German authorities. Source: German government
In related news, the German government was once one of the largest holders of Bitcoin globally, having recently sold nearly 50,000 BTC, valued at $3.15 billion, over several transactions in June and July. These funds were confiscated from the piracy website Movie2k.to in 2020.
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