Blockchain and the Battle Against Corruption & Fraud

Blockchain and the Battle Against Corruption & Fraud

Corruption, embezzlement, fraud, these are all characteristics which exist everywhere. It is regrettably the way human nature functions, whether we like it or not. What successful economies do is keep it to a minimum. No one has ever eliminated any of that stuff.”

-Alan Greenspan, former Chairman of the Federal Reserve of the United States.

“…until now.”


For the first time in history, we may actually have a viable solution to rampant political and economic corruption in the world.

Blockchain not only provides a technical solution to many of the world’s multifaceted problems, it activates a powerful, but relatively dormant, community of social innovators.

Countless industries from supply chain management to art proprietorship are expected to receive a back-end rewiring in the quest to eliminate inefficiency and increase transparency and decentralization.

When it comes to politics and systematic corruption, however, things aren’t as simple as replacing humans with math. It’s deeper than deposing corrupt political leaders and replacing them with more favorable leaders with an equal human propensity for corruption.  It’s more complicated than coming up with a “plug-and-play” universal blockchain solution that crypto-terians salivate over.



The mission is to sift through the sociopolitical cat litter and identify the problem variables that can be improved with blockchain and cryptocurrency for good.

Join us on an adventure to explore how blockchain and cryptocurrency can fight global corruption with insights from experts working on blockchain-based projects that focus on financial privacy, commercial data, and inflation. We’ve got Rob Viglione of ZenCash, Yoni Cohen of Novo Protocol, and Eiland Grover of Kowala.

  • Rob Viglione is the Co-Founder of ZenCash, a privacy-focused cryptocurrency that allows anyone in the world to earn income by staking their coins to run a secure node on the network. The privacy platform includes features such as messaging and media.
  • Yoni Cohen is the CEO and Co-Founder of Novo Protocol, a blockchain-based marketplace for commercial data that aims to bring business credibility to developing economies where the existing business data infrastructure is corrupted, inefficient, or non-existent.
  • Eiland Glover is the CEO and Co-Founder of Kowala, the world’s first autonomously stabilized cryptocurrency. He believes that while digital currencies such as bitcoin bring the citizens of Venezuela unparalleled financial freedom, bitcoin is a tremendously flawed solution.


A Global Solution to a Global Problem

The total cost of corruption around the world amounts to four to five percent of global GDP, nearly $2.6 trillion USD, according to the WorldEconomicForum. To put that into perspective, that’s like the entire annual nominal GDP of the United Kingdom, the world’s fifth largest economy, completely lost to the underworld of bribes and shady negotiations.

Countries in desperate need of economic growth such as Kenya are the greatest victims of internal corruption, as Kenya regularly loses a third (nearly $6 billion) of its state budget to corruption every year.

A significant amount of global corruption happens out of the immediate purview of government leaders, but what happens when the leadership itself is corrupt?



There is no lack of examples to choose from.

  • Ferdinand Marcos, President of the Philippines (1965 – 1986), embezzled an estimated $5B to $10B by taking over large private enterprises, skimming foreign aid, creating state-owned monopolies, and even directly raiding treasury and other government financial institutions.
  • Sani Abacha, President of Nigeria (1993 – 1998), the country’s seventh military head of state embezzled an estimated $2B to $5B, while also somehow miraculously reducing external debt from $36B to $27B and slashing inflation from 54% to 8.5%.
  • Mohamed Suharto, President of Indonesia (1967 – 1998), hit a grand total of $15B to $35B embezzled from his total control of state-run monopolies, supply contracts, and special tax breaks to companies owned by family members, close friends, and four children.


Corruption in Real Time: Venezuela

For a contemporary example, look at Venezuela, the world’s most dangerous country two years running.  As the Maduro government reigns on, politicians on every level are finding themselves increasingly divorced from a starved population, 90% of which is living in poverty.



“Demonstrators clash with riot security forces while rallying against Venezuela’s President Nicolas Maduro in Caracas, Venezuela, May 31, 2017. “REUTERS/Christian Veron/File Photo

Some Venezuelans are turning to alternatives such as cryptocurrency mining, as well as even killing dragons on Runescape to sell their loot/gold for USD to combat a minimum wage equal to about $47 USD per month and inflation approaching 13,000 percent in 2018.

“Venezuela’s currency has lost 99.99% of its value in the last 5 years. And yet Maduro’s regime was just re-elected. Why?

Hyperinflation occurs when a government cannot tax or borrow the money needed to cover its expenses. Instead, it prints money, leading to devaluation of the currency and steeply rising prices. Savings are wiped out, and people rush to put money into hard assets and stable foreign currency. Outside investment into the country halts, the tax base is eroded further, and the death spiral continues. Who profits? The people who get the newly printed money first.

Ironically, hyperinflation can, in the short run, strengthen an autocracy by weakening the entire populace, causing the emigration of qualified political challengers, and enriching the autocrat’s coterie. This is the current story in Venezuela.

Nevertheless, hyperinflation must end, and the most peaceful way to bring this about is through a “dollarization” of the economy. Ecuador, for example, stemmed its own inflationary spiral by officially adopting the U.S. Dollar as its national currency following the economic crisis of 1999.”

– Eiland of Kowala

With the country in collapse, Maduro devoted much of his time to an ironic “anti-corruption” spree and installing loyalists in their places. In May 2018, Maduro won another six years in power with 68% of the votes on a voter turnout of about 46.1%(down from 80% in 2013).


The Blockchain is Mightier than the Sword

Blockchain can be applied to a variety of use cases that tackle corruption on a global scale.

Immediate applications arise from the immutable (unable to be changed by anyone, even those in power)transparent (each block can be checked down to the genesis block), and efficient (less juggling of procedures between rapidly changing regimes) nature of blockchain technology.

These three features alone give rise to an ability to sanitize dirty transactions and voting procedures and weed out corrupt middle-man third parties.

The following commentaries come from experts working on different blockchain-based solutions that could play a substantial role in eradicating corruption.


How can blockchain and cryptocurrency provide financial freedom to citizens living under corrupt regimes?


A core component of the cryptocurrency ethos is bringing “power to the people”. The ability to carry and maintain an entire digital currency falls on a network of people all over the world, and no single central entity can shut it down.

The entire Bitcoin blockchain is about 161 GB, just a little above half of a modern iPhone’s storage. However, this file contains the history of every single transaction ever made using bitcoin including the addresses involved.

The same aspects that give blockchain its edge can be applied in a variety of ways to protect citizens living under corrupt regimes.

“Blockchain based identity providers, corporate registries, and credit networks will enable businesses and individuals to access capital and global markets without exposing their private information to corrupt or heavy-handed governments.

Cryptocurrencies can be used as a store of value as well as a means of transacting, which are especially useful to those living under corrupt regimes or in countries with an unstable national fiat.”

-Yoni Cohen of Novo Protocol

For citizens living in nations undergoing economic collapse, anchoring their livelihood into a rapidly inflating currency can be catastrophic. Citizens not only end up struggling to pay for daily expenses, they have to face highly disfavorable exchange rates should they choose to move to another country (if they’re lucky enough to have that option).

“The most obvious safeguard cryptocurrencies offer is immediate diversification from your local monetary system. When you’re in a failing economy with a collapsing currency, any alternative to get out is a good one.”

-Rob Viglione of ZenCash


Are corrupt regimes capable of shutting down cryptocurrencies in their country, or access to them? Why or why not?

“Power tends to corrupt, and absolute power corrupts absolutely. Great men are almost always bad men.”

– John Dahlberg-Acton

Power is a tough drug to kick.

People work their entire lives for the ability to influence the world, and very few are willing to give it up for the sake of integrity. Deposed dictators also don’t tend to experience pleasant fates after losing control. Any threats to power usually get swiftly and forcefully dealt with.

It’s fairly easy for a government with a firm grip on a country and its military to snipe out any “traitors of the people.” However, blockchain is different. There isn’t a central political agitator to assassinate, but a decentralized network of computers and nodes all over the world.

So, are blockchain solutions actually immune from regulatory and military pressure?

Cryptocurrencies can’t be shut down, however, users can be persecuted. This is a point I think is under-appreciated in both our industry and in governments. Industry enthusiasts like to point out that it’s impossible to shut down a distributed network and therefore our products are censorship resistant, while governments tend to be overconfident in their regulatory authority. The reality is, human suffering isn’t something we should callously brush over.”

– Rob from Zencash

“Only to a limited extent. Governments can work with ISPs to limit access and utility of virtual currencies within a given locale, however, the nature of decentralization makes it particularly difficult to completely shut down access.”

-Yoni from Novo

Regimes will have difficulty shutting down cryptocurrencies due to the decentralized nature of the blockchain. Nevertheless, governments will work hard to avoid losing their firm grip over the economy.

We can look to government responses to the internet and social media to understand how things may play out with cryptocurrency. These technologies freed information and helped citizens organize some successful regime-toppling protests as demonstrated during the Arab Spring. On the other hand, China, with its “Great Firewall,” has shown that it is possible for a country to exert significant control over the internet and social media.

Governments will also have to grapple with the fact that cryptocurrency and blockchain can also enable criminal and terrorist activity. Cryptocurrency projects like ours focused on increasing human freedom must create effective disincentives to prevent abuse of decentralized networks by bad actors, official or unofficial.

– Eiland from Kowala


How can your project provide relief/support to citizens in need?

The hallmark of an effective solution isn’t ideation, it’s implementation.

Over-hyped whitepapers aren’t going to put food on the table, nor keep oppressed peoples from under the thumb of corrupt leadership.

While blockchain’s implementation in solutions that could potentially eradicate or combat corruption is still embryonic, there are several projects that are developing and testing significant solutions.

“Designing quality products that empower individuals is the first step and layering strong security and a bit of privacy into them goes a long way. Our entire network is designed to protect users and make sure their private data isn’t leaked to adversaries, which can be hackers or even repressive regimes violating human rights. Going beyond the tech, we can, and absolutely should, come together as a community to speak out against repression and unnecessary suffering.”

– Rob from Zencash

“Novo enables businesses to circumvent poorly-functioning governments, credit bureaus that do not serve them well, and the local corruption by proving to global markets that they have the credibility and creditworthiness to be trusted as customers, suppliers and borrowers in the global marketplace.

– Yoni from Novo


Final Thoughts

While corruption can have disastrous effects on civilian populations in third world countries, it still poses a substantial problem for healthy economies as well. To name a few notable examples in American history:

  • Boss Tweed, a notorious American politician who went to jail in 1873 for a $1 billion-plus corruption ring.
  • Spiro Agnew, Richard Nixon’s Vice President (what a dynamic duo!) who accepted over $100,000 in bribes as governor of Maryland.
  • Enron, whose accounting fraud scheme and subsequent 2001 bankruptcy totaled $74 billion.
  • The 2008 financial crisis, where the people responsible for a crisis that cost America $12.8 trillion received bailouts instead of prison sentences (only one banker went to jail).

Circling back to the words of wisdom a la Greenspan, “what successful economies do is keep [corruption, embezzlement, fraud] to a minimum.”

Sure, widespread corruption and failing economies are definitely correlated, but the assumption that poor economies create corruption is negligent. Successful economies can be just as corrupt as failing economies, they’re just functional.

“Corruption” is nothing more than a betrayal of power, judged by a generally agreed upon set of standards. Betrayal happens in the dark or through a veil of orchestrated smokescreens. A country’s economy doesn’t necessarily determine the amount of corruption, but it does usually determine how detrimental the effects are for an already impoverished population.

Blockchain, minus all the buzzwordy clamor, is fundamentally a technology that maximizes transparency and efficiency – two of the main ingredients that tend to disappear from corrupt regimes.

Whether democracy or authoritarian, corruption exists.

This article was originally published on Coincentral.


Alex Moskov


“Top Misconceptions of Cryptocurrency as a Payment System”

Which can be read on Amazon Kindle Unlimited for Free  You can find more interesting articles by visiting us on one of the following platforms: AML Knowledge Centre (LinkedIn) orAnti-Bribery and Compliance at the Front-Lines (LinkedIn)

How Exchanges Are Using KYC Laws to Keep Your Crypto

How Exchanges Are Using KYC Laws to Keep Your Crypto

Bitcoin is the world’s first successful attempt at creating a decentralized economic structure. At its core, is a belief that individuals deserve a sovereign currency. Many Bitcoin enthusiasts feel that these beliefs lie beyond the scope of know your customer (KYC) laws and federal institutions. Unfortunately, crypto exchanges don’t always share these beliefs.

Crypto exchanges have seen astounding growth over the last two years which has caught the attention of government officials. Exchanges have long been a point of centralization within the crypto space. This centralization makes exchanges the obvious choice for regulators looking to impose their will on the market.

IRS Targets Exchanges

Coinbase spent the last nearly two years battling the IRS over revealing their clients’ personal information. At first, Coinbase stood tall, refusing to provide the IRS with any private customer information. But it wasn’t long before Coinbase was forced to comply. It now appears that these demands include the institution of KYC protocols.

What is KYC?

KYC or know your customer laws are anti-money laundering regulations that were developed in the wake of the 9/11 attacks. The stipulations for these regulations were crammed into the USA PATRIOT Act. These regulations were designed to prevent money laundering from being used to fund terrorist organizations.

Today, KYC is used by most financial institutions around the world. In the banking sector, asking someone to provide all of their personal information is customary, but, until recently, crypto services didn’t require this information.

You see, back when BTC was only worth $100, there wasn’t a problem with a guy owning 5,000 BTC without paying any taxes. Today, a single BTC is worth more than $6,000 apiece and that same guy, he now has $500,000.00 in crypto. You better believe the tax man is interested in his cut this go-around.

If Crypto Isn’t Legally Money, Then Why KYC?

This is a question for the ages. In most countries, including the USA, cryptocurrencies are not considered legal tender but instead virtual currency. Despite the differences between fiat and digital currency, KYC laws are being implemented at breakneck speed across the entire market. Exchanges are the obvious target for regulators because they are the choke points of the marketplace.

Coinbase illustrates just how quickly an exchange can go from battling to protect your privacy, to instituting KYC procedures. Coinbase isn’t alone in their efforts either, and most major exchanges are stepping towards integrating at least some form of KYC in the future.

KYC: Keep Your Crypto

Although it is disheartening to see, you really can’t blame these exchanges for folding under the government’s pressure. In the past governments have used terrorism as the primary reasoning for their approach. Therefore, any exchange which refuses to implement KYC protocols could fall under intense scrutiny.

The real issue arises with the growing number of crypto traders who are being locked out of accessing their funds because of unannounced KYC implementation. Let’s look back to Coinbase to explain this point with more clarity.

Originally, Coinbase simply required your personal information such as your name, date of birth, and social security number to open an account. This was a very easy procedure and millions of crypto investors signed up for the platform. The platform allowed fiat trading pairs, making it one of the most user-friendly options at the time. Most users were willing to share a little information in exchange for the ease of access that the platform provided.

Coinbase soon became the largest exchange in North America. Fast forward to the beginning of this year and you now see Coinbase requiring full KYC compliance, prior to allowing the withdrawal of your funds. This protocol was instituted without warning and it allowed Coinbase to confiscate a significant amount of crypto. The exact amount is unknown.

Reddit Activity on the Topic

A quick glance through the latest Reddit posts reveals many investors in the same predicament. In one post, an individual explains in depth how the exchange Bitstamp only required his driver license to sign up and load his account with funds. But when he went to withdraw, he was halted by a flurry of intrusive questions regarding the nature of his investments.

Herein is where the true problem lies. Exchanges should have to notify their clients when they are instituting new withdrawal procedures. This is especially true when the protocols are as intrusive as these. Below are just a few of the questions you may be required to answer the next time you want to withdraw your crypto.

  • What are your future trading plans/intentions?
  • What is the address and SWIFT code of your bank?
  • Do you plan more withdrawals?
  • What is the origin of your deposited BTCs?
  • Please provide a verified receipt of your mining equipment and the technical specifications.
  • What will you use your BTC on?

So What Now?

You can always turn to decentralized exchanges if you are looking to continue your crypto trading aspirations in private. Decentralized exchanges are becoming more popular and unlike their centralized counterparts, they are hardly a good target for hackers. Most decentralized exchange platforms don’t even handle your crypto directly. Instead, the entire process is conducted directly Peer-to-Peer.

Regulations on the Horizon

While BTC isn’t so easy to reign in, the rest of the coins in the crypto market have actual company representatives and executives that are unable, or unwilling, to stand up to the powers that be when it comes to protecting your information.

Talk of regulations continues to grow, and many crypto experts believe this to be a necessary step towards full-scale adoption. It will be interesting to see how the market develops as KYC laws continue to plague many investors in the space. For now, take this as just one more reason to never leave your coins sitting on an exchange.

This article was originally published on Coincentral.


David Hamilton


“Top Misconceptions of Cryptocurrency as a Payment System”


Which can be read on Amazon Kindle Unlimited for Free  You can find more interesting articles by visiting us on one of the following platforms: AML Knowledge Centre (LinkedIn) or Anti-Bribery and Compliance at the Front-Lines (LinkedIn)


On the Frontline: How Blockchain Forensics Fight Crypto Crimes

On the Frontline: How Blockchain Forensics Fight Crypto Crimes

One of the first things that any crypto noob learns about Bitcoin is that it isn’t anonymous. The takedown of dark web marketplace Silk Road is one of cryptocurrencies most-referenced case studies illustrating this fact. It tells how law enforcement bodies can use blockchain forensics to trace the movements of digital money. In this way, they can also uncover the owners of wallet addresses. 

But the unmasking of Silk Road’s Ross Ulbricht is only one story. Criminals are continuing to use and abuse cryptocurrencies, including Bitcoin, for all kinds of nefarious endeavours. Therefore, blockchain forensics provides a few other fascinating tales of attempts to foil the crooks.

Using Bitcoin leaves behind its own fingerprints. Image source: Pixabay

Blockchain Forensics in Exchange Hacks

Like Silk Road, the Mt. Gox exchange hack also has its place in the Cryptocurrency Book of Fables (sadly, not a real thing at the time of writing). The story of Mt. Gox has more twists and turns than a corkscrew, and the saga continues to this day. It makes for a fascinating study in blockchain forensics, featuring one hardcore crypto vigilante who spent more than two years of his life trying to uncover who was behind it.

Back in 2014, Swedish software engineer Kim Nilsson was living in Tokyo when the Mt. Gox exchange shut down, and all his Bitcoins suddenly vanished. Later, it would emerge that hackers had been syphoning off funds from the exchange since 2011.

However, in response to the theft of his funds, Nilsson developed a program that could index the Bitcoin blockchain and started investigating Mt. Gox. By searching through each transaction, he identified some patterns. Although by itself this didn’t provide information about who was behind the trades, Nilsson also managed to get ahold of some leaked information about the Mt. Gox database, including a report put together by another developer.

Following the Money

In a painstaking effort that he undertook in addition to his full-time job, Nilsson assembled some two million Bitcoin wallet addresses associated with Mt. Gox. Using a kind of manual brute-force blockchain forensics, he followed the flow of Bitcoins out of these Mt. Gox addresses. He noticed that some Bitcoins stolen from Mt. Gox ended up in wallets that also held Bitcoins stolen from other exchange attacks. By cross-referencing transactions, he found a note attached to a trade that referred to someone called WME.

Through further digging, Nilsson discovered that WME was associated with a crypto exchange based in Moscow. He found that WME held accounts with this exchange, called BTC-e. Nilsson also worked out that some Mt. Gox Bitcoins had ended up in BTC-e accounts.

Unmasking the Villain

Nilsson went online and started trying to find out who was behind the name WME. It was not as difficult as it could have been. Ironically, in a fit of outrage over another exchange having scammed him, WME had inadvertently left his real name on a message board. Nilsson finally discovered the individual behind the Mt. Gox hack: Alexander Vinnik.

Even before Nilsson provided Vinnik’s name to investigators, BTC-e was under investigation due to involvement with various other cryptocurrency criminal activities. By the end of 2016, the US authorities had sufficient evidence to issue a warrant for the arrest of Alexander Vinnik.

However, he was living in Russia at the time, so investigators waited until he left the country for a vacation in Greece. He was apprehended in July 2017 and has been held in custody in Greece ever since. Both Russia and the US have sought to extradite him.

Live action recreation portraying the dramatic moment of Vinnik’s arrest. Image source: Pixabay

The latest news report stated that the Greek government had approved his extradition to Russia.

While all this sounds like the plot of a movie, it serves to illustrate the degree to which the world of crypto is unregulated. It only took one vigilante using his own blockchain forensics, and years of dedicated focus, to bring down an international cybercriminal.

Professional Blockchain Forensics

Jonathan Levin was also one of the investigators of Mt. Gox, working on behalf of the exchange’s trustees. Levin went on to start Chainalysis, a blockchain forensics company, which provides software that can now undertake the kind of extensive blockchain analysis that Nilsson did by himself.

Blockchain Intelligence Group (BIG) provides a similar service. These companies are used by law enforcement agencies, but also by cryptocurrency businesses who see advantages in using blockchain forensics to screen customers.

Ransomware Attacks

Criminals are now finding other ways of obscuring their movements on the blockchain. Mixer services jumble together coins in an attempt to confuse the trail of individual transactions. Increasingly, criminals, such as those behind the WannaCry ransomware attack, are also using privacy coins such as Monero to increase their chances of remaining hidden.

WannaCry emerged in 2017. It was a global ransomware attack that exploited weaknesses in Microsoft Windows to encrypt all of the data in a users computer. Once the data was encrypted, the program demanded payment in Bitcoin to decrypt the data.

Microsoft quickly released patches, but by that time more than 200,000 computers had been affected across 150 countries. It hit hard. One estimate put economic losses at $4bn. 

Screenshot from a machine infected by the WannaCry worm. Image source: Wikipedia

Although experts advised against paying the Bitcoin ransom demands, the WannaCry attack netted its architects some $140,000 in Bitcoin. The architects remain unidentified.

However, in August 2017, various sources reported movements of Bitcoins from the addresses associated with the attackers. They used Swiss company ShapeShift to convert the coins into Monero, meaning they will now likely never be found given the tight privacy around the use of Monero. ShapeShift has since taken steps to blacklist those addresses.

The Good, the Bad, and the Blockchain

The WannaCry case shows that blockchain forensics, like any branch of forensics, is not infallible. However, like blockchain itself, blockchain forensics is still in its infancy. Of course, criminals will always find ever more creative ways to use cryptocurrencies for nefarious purposes. Hopefully, there will always be someone like Kim Nilsson, or companies like Chainalysis or BIG using blockchain forensics to seek them out.

This article was originally published on Coincentral.


Sarah Rothrie

Sarah ran away from a corporate job so she could travel the world. After doing that, she found herself a much-loved new career as a freelance blockchain technology writer. She is now a full-time digital nomad, who travels the world while working on her laptop. In addition to writing and researching, she also runs her own websites – find out more at You can usually locate her somewhere near the food.


“Top Misconceptions of Cryptocurrency as a Payment System”


Which can be read on Amazon Kindle Unlimited for Free  You can find more interesting articles by visiting us on one of the following platforms: AML Knowledge Centre (LinkedIn) or Anti-Bribery and Compliance at the Front-Lines (LinkedIn)

Blockchain Remittance: The Future of International Money

Blockchain Remittance: The Future of International Money

Blockchain remittance firms are experiencing record growth thanks to an increase in global migration. As populations continue to migrate, the need to send money back to their home countries is growing. Blockchain remittance firms are providing this essential service at a reduced rate.

These international payments are vital to the livelihood of millions of people around the world. They’re primarily used for living expenses such as food, transportation, and education. Making these statements more tangible, East Asian countries received $129 billion in remittance payments last year according to the World Bank.

Remittance Stats

Remittance Statistics via the World Bank

A recent study revealed that the remittance sector has grown to a staggering $585 billion industry. In 2017 alone, $439 billion was sent to developing countries, equating to around 700 million families living off of remittance payments globally.

Remittance payments have also become the main source of foreign income for many nations. According to a May report in Forbes, Mexico’s remittance payments have now superseded their oil industry to become the country’s main source of foreign income.

Mexico isn’t alone in their dependence on remittance payments. The World Bank released their 2016 remittance statistics in April of this year. The report revealed that remittance payments are now more stable than private capital flow in terms of international growth. This means that the remittance industry could be a smart investment in most parts of the world.


The High Costs of Sending Remittance Payments

Sending money internationally isn’t cheap, and non-profits such as the World Bank have been combating these high fees for years. Since 2008, remittance fees have declined 7.32 percent. This decrease saved migrants $90 billion in fees over the same time frame.

Whenever someone sends money internationally, numerous third-party organizations are involved in the transaction. Each verification step adds a small fee to the total cost. In addition, international conversion rates must be accounted for. World Bank reports have averaged these costs to be around 7.45 percent of each transaction processed.


Blockchain Remittance Fintech: Technology to Help Millions

Blockchain remittance companies are taking the industry to the next level by facilitating a frictionless experience for users. Traditionally, international money transfers can take days to complete due to the number of verifications that are required. Blockchain remittance companies provide instant money transfer services.


Remittance Firms: Abra

Africa relies heavily on remittance payments. Until recently, large financial firms, such as Western Union and MoneyGram, dominated the market. This changed when blockchain remittance companies began to spring up across the continent. Firms such as Abra are now changing the local markets.

The Abra platform allows users to transfer money for free across the globe. In addition to these cost savings, users are able to send transactions directly from their mobile devices. Abra offers a direct peer-to-peer money transfer technology that doesn’t require the use of any bank. And, the platform automatically deposits funds onto debit cards that it provides for users.

Remittance Payments via Abra

Abra is pioneering remittance FinTech with this all-inclusive approach. This non-reliance on the traditional banking system is important in developing nations because they often lack the means to implement the expensive infrastructure required to institute these organizations. By circumventing the current system, Abra users don’t have to worry about how to transfer money from blockchain to bank account.

Migrants are saving on fees and conversion rate costs by removing the middleman from the remittance system. These savings are too large to ignore, and now, industry leaders are researching this technology.


Blockchain Remittance on the Rise

For the first time ever, this year’s Global Money Transfer Summit (GMTS) will feature blockchain remittance FinTech. The GMTS is the largest international money transfer conference in the world. Every year, representatives from major financial institutions are chosen to speak at this event.

Among those invitees are representatives from Ripple, Stellar, and Cashaa. These popular cryptocurrency representatives will discuss the future of the money transfer industry and why blockchain technology is an essential path for the industry to travel.


Remittance Cryptocurrencies: Ripple

Ripple (XRP) was one of the first bank-focused cryptocurrencies to enter the market in 2012. Designed primarily for large international inter-bank money transfers, Ripple’s developers describe it as a real-time gross settlement system. The Ripple platform utilizes the XRP token to facilitate these global transfers instantly.

Ripple has managed to secure major partnerships with numerous large financial organizations including Fidor Bank in Munich, Bank of America, and Santander. In May 2015, Ripple became AML compliant after receiving a $700,000 fine from FinCEN for not complying with the Bank Secrecy Act. Today, the cryptocurrency remains in the top five coins in terms of market capitalization.


Remittance Fintech: A New Horizon

Blockchain technology is transforming the remittance sector, and Ripple isn’t alone in their quest to service the international money transfer industry. Today, numerous remittance-focused cryptocurrencies are available. You can expect to see further integration of this game-changing technology.

Now that the industry has openly acknowledged the benefits that blockchain technology brings to the table, the demand for blockchain-based remittance services is expected to increase significantly. This is great news for the millions of families that rely on this lifeline to survive.

This article was originally published on Coincentral.


David Hamilton

David Hamilton aka DavidtheWriter has published thousands of cryptocurrency related articles. Currently, he resides in the epicentre of the cryptomarket – Puerto Rico. David is a strong advocate for blockchain technologies and financial sovereignty.


“Top Misconceptions of Cryptocurrency as a Payment System”


Which can be read on Amazon Kindle Unlimited for Free  You can find more interesting articles by visiting us on one of the following platforms: AML Knowledge Centre (LinkedIn) or Anti-Bribery and Compliance at the Front-Lines (LinkedIn)

Blockchain Fraud: New Policies and Technologies to Stop Crypto Criminals

Blockchain Fraud: New Policies and Technologies to Stop Crypto Criminals

Blockchain fraud continues to be a massive problem that has hindered the possibilities of new user adoption. Crypto criminals primarily participate in three types of fraud: tax evasion, money laundering, and terrorist funding schemes. Let’s take a look at each of those categories and how legislation and blockchain technology can reduce, or even eliminate, these and other crimes in the near future.

Tax Evasion

Tax evasion is one of the most widespread types of blockchain fraud. Prior to 2017, there wasn’t much crypto-related legislation in existence in most countries. Plus there was little enforcement of what regulations did exist. As we have previously reported, this began to change drastically in 2017.
Despite the fact that regulations are tightening, crypto-related tax evasion is still prevalent. In November 2017, LendEDU conducted a survey that included 564 US-based bitcoin investors. According to the results, approximately 36% of participants planned to knowingly avoid paying capital gains taxes in their 2018 tax filings.

There aren’t any stats to determine if this was the actual result. Still, it’s obvious that many people didn’t view crypto tax evasion as a major crime. And it’s possible that those surveyed weren’t exactly sure how to follow the tax regulations. In 2018, however, there are several guides online on how to follow crypto taxation laws in specific countries. Information is even available on specific categories like taxation on cryptocurrency mining.

New Tax Regulations

Investors need to understand and comply with cryptocurrency tax regulations. In some cases, compliance can be beneficial beyond avoiding the obvious consequences of jail time or fines. For example, it’s possible to report capital losses on crypto investments when filing taxes.

Even in the bear market of 2018, regulatory agencies are focusing more on crypto taxation policies. These efforts aren’t just limited to individual, domestic government policies. International collaboration appears to be on the rise as well. For example, a coalition of five governments (Australia, Canada, the Netherlands, the United Kingdom, and the United States) joined together to form the Joint Chiefs of Global Tax Enforcement (J5). According to the IRS, this organization aims to “reduce the growing threat posed to tax administrations by cryptocurrencies and cybercrime.”

Blockchain Fraud: An image of a phone showing bitcoin on top of 4 $20 bills, displaying fiat and cryptocurrency
Tax evasion is one of the most common types of blockchain fraud.

Money Laundering

There are several major cases involving the use of cryptocurrencies to launder money. Jerome Powell, Chairman of the U.S. Federal Reserve, said in a House Financial Services Committee testimony in July 2018 that “they are very challenging because cryptocurrencies are great if you’re trying to hide or launder money, we have to be very conscious of that.”

Evidence shows that crypto-based money laundering is indeed a major issue. For example, according to a Q2 2018 report released by CipherTrace, crypto criminals laundered $1.2 billion through bitcoin tumblers and privacy coins in a one-year time period during 2017-2018.

Similar to policies dealing with crypto tax evasion, governments are increasing international collaboration to tackle this type of blockchain fraud. G20 member countries are reviewing a possible global anti-money laundering (AML) standard on cryptocurrency before an October 2018 deadline. In addition, member nations have called upon the Financial Action Task Force (FATF) – an intergovernmental organization formed to combat money laundering and terrorist financing – to review how AML standards that are already in place can potentially be applied to regulate cryptocurrencies.

Blockchain fraud: An image showing a dark hallway of jail cells
Governments are collaborating on an international level to stop crypto criminals involved in money laundering.

Terrorist Funding

Some financial institutions (including the Bank of England) and regulatory agencies have warned against the potential use of cryptocurrencies in terrorist funding. For the most part, various studies don’t show any alarming correlation between crypto and terrorist funding. For example, the European Parliament’s Policy Department for Citizens’ Rights and Constitutional Affairs conducted tests on the risks of cryptocurrencies. According to the results, cryptocurrencies don’t pose a greater risk than fiat when it comes to enabling terrorist funding.

Since 2017, there has been a push to enact legislation that would try to prevent this kind of blockchain fraud. For example, U.S. lawmakers introduced the “Homeland Security Assessment of Terrorists Use of Virtual Currencies Act” in May 2017. They also proposed the “Financial Technology Innovation and Defense Act” in January 2018. Additionally, another bill called “The FinCen Improvement Act of 2018″ was introduced in the US House of Representatives in July 2018. This bill mentions, “anti-terrorism and anti-money laundering initiatives, including matters involving emerging technologies or value that substitutes for currency, and similar efforts’’.

As of August 2018, none of these bills have gained much traction. Only the “Homeland Security Assessment of Terrorists Use of Virtual Currencies Act” has been able to pass the U.S. House of Representatives.

Blockchain Fraud: A photo of the United States Capitol.
The US Congress has introduced a few bills to stop terrorist funding through cryptocurrencies.

Using Blockchain to Combat Blockchain Fraud and Other Crimes

Yes, in some instances, blockchain fraud makes certain crimes easier for criminals to commit. However, it’s also crucial to understand that many of the above-mentioned crimes have been going on for many decades in the fiat economy.

Even though blockchain fraud is a major issue, blockchain technology has also made it possible to stop many types of crime. For example, some blockchain technologies like Ricardian smart contracts aim to vastly improve the future enforcement of legal agreements. In addition, KYC and AML-focused projects can make transactions in the crypto-based economy much more transparent than what’s possible in the current fiat-based economy.


Crypto criminals do exist and present a challenge to the mainstream adoption of digital currencies. Nonetheless, technical innovation should not be viewed as the foundations for a future dystopia. Likewise, the legislation doesn’t have to stunt the progress of technology.

When it comes to stopping crime and fostering innovation, there isn’t a simple solution. How the future will play out depends a lot on how technologies and legislation develop in the coming years. The reality is that both regulations and technologies are needed in order to empower a future where blockchain can benefit society and mitigate the possibilities of blockchain fraud.

This article was originally published on Coincentral.


Delton Rhodes

I enjoy researching new, innovative, and interesting blockchain/crypto projects that have the potential to impact the world. Whenever I’m not writing, I’m usually playing sports or producing music.


“Top Misconceptions of Cryptocurrency as a Payment System”


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What Is Cryptojacking? Protect Yourself from This Year’s Biggest Cyber Crime.

What Is Cryptojacking? Protect Yourself from This Year’s Biggest Cyber Crime.

It sounds like an adrenaline-packed adventure sport. You can almost imagine telling your friends you went cryptojacking down a volcano whilst on vacation in Costa Rica. But no, sadly the only thing that will get high doing cryptojacking is your power bill. And probably the hacker behind it, filling his or her virtual wallet with Monero. So, what is cryptojacking again?

What Is Cryptojacking?

Cryptojacking is where a device is unexpectedly taken over to use its computational power to mine cryptocurrency. There are several ways this can happen. And just because you have a robust anti-virus in place doesn’t necessarily mean you’re safe. It’s fairly simple to download malicious code from a seemingly innocent vector, like a free content management system.

You don’t even need to download the code to get cryptojacked since there are plenty of websites that are infected with JavaScript code. This in-browser cryptocurrency mining isn’t so much of a problem, and, in fact, several sites are exploring it as a potential replacement revenue stream for advertising. You simply consent to help mine for the time you use the site.

That said, the majority of websites that are infected with mining malware are unaware. Earlier this year, for example, over 300 websites using the Drupal content management system got infected with Coinhive JavaScript software used for mining Monero. These victims included the San Diego Zoo, UCLA, and even Lenovo.

Coinhive is the most popular code for in-browser mining since it’s easy to deploy and often goes unnoticed. Even plugins like NoCoin for Chrome and Firefox may fail to detect Coinhive infected sites. In fact, as much as 82 percent of infected sites go undetected.

It’s a pretty safe bet that most of San Diego Zoo’s visitors aren’t into cryptocurrency. So, if you think that it’s an industry-specific problem, think again. You can get cryptojacked just about anywhere, at any time.

Cryptojacking is the biggest cybersecurity threat of 2018, with one-quarter of all businesses already falling victim to it. It’s not mega businesses the hackers are after either. It’s not cryptocurrency exchanges, ICOs, or even HODLers that they want. It’s anyone with a mobile phone, personal computer, server, or even IoT device.

What Is Cryptojacking Capable Of?

There’s good and bad news about cryptojacking. Unlike some more malicious attacks like Ransomware, the hackers aren’t aggressively taking hold of your device. You may not even realize that it’s happening, as long as they don’t set the code to use a very high amount of computational power.

What you may notice is that your device overheats or lags in performance. But, if you’re used to a device that runs less than optimal, let’s be honest, cryptojacking can pass by undetected – until a big power bill hits you at the end of the month. While this is a drag to be sure, it’s certainly not as bad as having your Ether wallet hacked or your data leaked.

In some cases, though, cryptojacking can damage your device. If the hacker gets too greedy with the amount of CPU, he or she takes your computer could be sent into an irreparable tailspin.

What Is Cryptojacking Prolific On?

Everyone knows that mining cryptocurrency takes a high amount of computational power. This means that company servers are the best target. Yet, cryptojacking is more about taking a little bit of power from a lot of devices, rather than one major attack. With that in mind, cryptojacking is now prolific on any device, from mobile phones to IoT devices.

According to Kaspersky Lab, once mobile mining becomes more profitable, cryptojacking will explode in proliferation. The sheer number of mobile devices worldwide makes them an obvious target.

Major Cryptojacking Incidents to Date

Although cryptojacking is a non-aggressive form of cybercrime, that shouldn’t make you more sympathetic to its perpetrators. They’re making a lot of money mining cryptocurrency illegally using other people’s devices without authorization.

Some of the most high-profile cases so far have been the Shominru mining botnet that infected over 500,000 machines. It targeted Windows’ servers and forced them to mine over $3.5 million of Monero.

Another major cryptojacking incident was the Siacoin Internet Cafe hack when hackers across China mined around $800,000 million in Siacoin by infecting internet cafes with malicious cryptojacking code.

Other Cool and Creepy Facts About Cryptojacking

  • You don’t need technical skills to do it! According to a Digital Shadows’ report cited in CSO Online, you can buy “cryptojacking kits” on the dark web starting at just $30.
  • In Q4 2017 incidents of cryptojacking exploded by 8,500 percent.
  • Malvertising is a popular channel for infecting devices with crypto mining botnets.
  • Android users are more susceptible to cryptojacking, with 60 million already hit by crypto miners this year.
  • At least 13,000 WordPress Plugins contain critical security vulnerabilities that make them easy prey for hackers.
  • Social media is also a big vector, especially through phishing tactics using official-looking emails asking users to click through to a site, which then runs a code on your computer.
  • In-browser mining happens only when you visit the infected site. Close the site, stop the mining. Mining botnets downloaded to your device will sit and mine from now until infinity unless you get them removed.
  • Avast Software found that Github was a popular vector for cunning crypto miners. They simply create forks of existing legitimate products and hide the malware within.


Can You Prevent Cryptojacking?

You may not be able to prevent cryptojacking. You may just get unlucky. But there are certain cyber hygiene practices that you can adopt. Never click on a link in an email. Don’t be fooled even by an HTTPS site, as it may still contain malware. Try running an anti-phishing software, antivirus, and adblocker. Plugins like NoCoin and MinerBlock may also help prevent some incidents.

Companies looking to prevent their servers from getting cryptojacked need to carry out good patch management and educate their employees on what to look out for to prevent phishing attacks.

It’s not always easy to detect cryptojacking since most desktop antiviruses won’t notice the malware. But you will see your battery getting extra hot or draining down quickly or your computer taking longer than usual to complete tasks.

Companies should have an easier job of detecting cryptojacking since it’s fairly easy to see when using network monitoring solutions, which most organizations should have. IT departments should also constantly monitor their website files for any new JavaScript code or file changes.

Closing Thoughts

What is cryptojacking? It’s 2018’s biggest cybercrime, which is growing in popularity. So, if you think your device may be infected, don’t wait. Go and get it checked out today.

This article was originally published on Coincentral.


Christina Comben

Christina is a B2B writer and MBA, specializing in fintech, cybersecurity, blockchain, and other geeky areas. When she’s not at her computer, you’ll find her surfing, traveling, or relaxing with a glass of wine.


“Top Misconceptions of Cryptocurrency as a Payment System”


Which can be read on Amazon Kindle Unlimited for Free  You can find more interesting articles by visiting us on one of the following platforms: AML Knowledge Centre (LinkedIn) or Anti-Bribery and Compliance at the Front-Lines (LinkedIn)