An experienced cybersecurity prosecutor has been selected by the Justice Department to lead a new unit tasked with researching and prosecuting illicit cryptocurrency schemes perpetrated by cyber criminals and nation states such as North Korea and Iran.
Deputy Attorney General Lisa Monaco announced Thursday that Eun Young Choi will be the inaugural director of the National Cryptocurrency Enforcement Team, which will be the focal point for efforts to identify and disrupt the misuse of cryptocurrencies and other digital assets.
“If we’re going to see cryptocurrency acquire greater traction and wider use, as I believe we will, we have to make sure that the ecosystem in which they operate can be trusted and, frankly, policed,” Monaco said in an interview.
The $2 trillion cryptocurrency industry has exploded as businesses and investors seek bigger profits and a footing in a technology that is still in its infancy.
Prosecutors and regulators are scrambling to figure out how to police that space — as well as the market for other digital assets like nonfungible tokens — which has emerged as a new frontier for criminals and rogue states to steal and launder billions of dollars using anonymous methods like blockchain transactions, encryption, and digital wallets.
According to Chainalysis, a blockchain analytics business, illegal transactions increased by about 80% to $14 billion in 2021, an all-time high. Despite this, criminality accounted for a significantly smaller portion of total crypto transaction volume, which rose dramatically last year, according to the firm.
In an interview, Choi claimed that one of the new team’s key objectives will be on uncovering criminal activities on virtual currency exchanges as well as bitcoin tumbler, or mixing, services, which are used to disguise contaminated assets.
Choi, dubbed “EYC” by her coworkers, most recently served as senior counsel to Monaco on cybersecurity issues. The department’s criminal section houses the crypto team, which now has over a dozen experienced prosecutors and aims to add more.
“We’re attempting to consolidate so that we can be a one-stop shop for all of the department’s subject matter specialists,” Choi, 41, explained.
When the crypto squad was launched in October, Monaco stated that one of the main goals would be to prosecute cryptocurrency exchanges and other companies proven to be breaking the law and helping in the flow of illegal funds. While exploring new probes, the crew would provide support to existing probes.
Although Choi did not identify any specific exchanges, Bloomberg News recently reported that the Justice Department and the Internal Revenue Service are looking into whether Binance Holdings Ltd., the world’s largest crypto trading platform, is being used to launder money and avoid taxes.