Child abusers are increasingly using cryptocurrency to conceal their activities and evade law enforcement. Research by the crypto tracing firm Chainalysis has revealed that sellers of child sexual abuse materials (CSAM) are now more adept at using advanced techniques such as “mixers” and “privacy coins” like Monero to launder their profits. These methods make it more challenging to trace their transactions.
The study by Chainalysis shows a worrying trend: CSAM vendors active in 2023 were able to operate online for much longer periods compared to previous years, indicating a growing sophistication in evading detection. For instance, the average online duration for CSAM vendors in 2023 was 884 days, a significant increase from 560 days in 2022 and just 112 days in 2020.
One of the key strategies employed by these vendors is the use of cryptocurrency mixers. These services mix users’ funds, complicating the process of tracing the original source of the money. Chainalysis found that about 46% of CSAM vendors used mixers in 2023, up from around 22% in 2020.
Another tactic is the use of “instant exchanger” services, which allow for the swapping of Bitcoin for privacy coins like Monero and Zcash. These privacy coins are designed to obfuscate or encrypt their blockchains, making it much harder to trace the movement of funds. The adoption of Monero among CSAM vendors is particularly notable, with Chainalysis reporting a significant increase in its use for laundering proceeds through instant exchangers.
Despite these challenges, the overall scale of CSAM-related cryptocurrency transactions seems to be declining, with Chainalysis noting a 22% drop from 2022 to 2023. This decline might be attributed to a growing awareness among CSAM vendors that cryptocurrency transactions can be traced, as highlighted by high-profile cases like the Welcome to Video dark web site.
The evolution of these tactics shows a complex and concerning landscape in the digital exploitation economy, where CSAM sellers who were once naive about the traceability of cryptocurrency transactions are being replaced by more cautious and sophisticated actors. However, organizations like Chainalysis continue to adapt and refine their tracing techniques, remaining a significant deterrent to these illegal activities​​​​​​.
