Europol and authorities in the Netherlands and Luxembourg have swooped in on Bestmixer.io, one of the world’s leading cryptocurrency mixing services.
The first law enforcement action to be taken against a cryptocurrency mixer service, the investigation started back in June 2018 with the Dutch Fiscal Information and Investigation Service (FOID) and McAfee seizing six servers in the Netherlands and Luxembourg.
Cryptocurrency mixing services or cryptocurrency tumblers are services that facilitate the mixing of identifiable or “tainted” cryptocurrency funds with others, with the aim of obscuring the trail back to the original source. A form of laundering, it essentially breaks the connection between the address a cryptocurrency was sent from, and the one it is being sent to.
Bestmixer.io was one of the three largest services of this type and it offered to mix Bitcoin, Bitcoin Cash, and Litecoin. The service went live in May 2018 and had turned over in excess of 27,000 Bitcoins, equating to around $200 million. One of its biggest attractions was that it guaranteed that its clients would remain completely anonymous.
It is claimed that the portal made over $600,000 in profits each month and that most of its users were based in the US, Germany and the Netherlands. Europol also confirmed that many users had failed to use a VPN service, making tracing offenders a lot easier.
The ongoing investigation into the service showed that most of the cryptocurrencies that had been ‘mixed’ on Bestmixer.io came from criminal origins. In many cases, it is believed that it was used to conceal the flow of vast amounts of laundered money.
The Dutch authorities have said that all interactions on the platform over the last 12 months have been collected by them and will be analysed over the coming months. These include IP-addresses, transaction details, bitcoin addresses and chat messages. The information will also be shared with Europol and the security and intelligence services of applicable other jurisdictions.
“The Dutch FIOD has gathered information on all the interactions on this platform in the past year; this includes IP-addresses, transaction details, bitcoin addresses, and chat messages,” Europol said. “The FIOD will now analyze this information in cooperation with Europol and intelligence packages will be shared with other countries.”
Whilst the news of the action was released today, Bestmixer.io went offline yesterday on the 22nd May.
Earlier this month, darknet market place “Wall Street Market” was busted by Europol and German police who seized a “six figure amount” of Bitcoin and Monero.
The second biggest illegal online marketplace on the dark web was closed down after a joint investigation identified the owners, and those using the platform to traffic drugs.
“The police officers seized over €550 000 in cash, alongside cryptocurrencies Bitcoin and Monero in 6-digit amounts, several vehicles and other evidences, such as computers and data storage,” said the Europol in a press release.
This lates bust is yet another example of EU authorities taking steps to further legitimise the market. By taking harsh measures against bad actors, those who are looking to work legitimately in the sector, can do so with increased confidence from the public.