Blockchain technology and money laundering

Abstract

In this paper, we want to break down certain prejudices against new blockchain technologies and cryptocurrencies, especially the Bitcoin, as instruments having mostly negative connotations and representing an opportunity for various criminal activities, including the cases of money laundering where money has been acquired in unethical and illegal ways. According to that aim, there were applied the methods of genetic, structural and functional analysis, the method of correlative variations, as well as the analogous and normative method. A significant part of the paper is dedicated to an introduction to DLT - (Distributed Ledger Technologies), i.e. a distributed book of records technologies, on which the blockchain and its most important exponent - the Bitcoin - rests. Also, we had to touch upon the second most important contribution to this technology, namely the Ethereum blockchain, which expands the perspectives opened by the Bitcoin, and thus the possibilities for misuse of this technology, primarily due to its constitutive principle of anonymity. In the paper, we have shown the fact that despite inadequate legislation, both nationally and globally, the blockchain and cryptocurrencies have not significantly supported the paths of illegal money laundering, especially not related to serious crimes, in particular drug trafficking and terrorism. We mostly see the contribution of this paper in the typologization of possible money laundering procedures, especially by using the NFT (Non-Fungible Tokens), non-exchangeable tokens whose hype, in last two years, might be the result of a perceived opportunity for a new way of money laundering. We conclude that we should not be afraid of the Bitcoin, but it should be accepted as an integral part of a peaceful and prosperous futurity for it opens new perspectives for humanity burdened with bigger problems than money laundering, which had existed to the same degree even before the appearance of the Bitcoin.