The European Union Agency for Law Enforcement Cooperation has released a report detailing the impacts of artificial intelligence and cryptocurrency on organized crime.
In a comprehensive assessment of serious and organized crime, the agency highlighted that AI and crypto contribute to the effectiveness of criminal activities. It noted that criminal organizations have shown a notable capacity to swiftly adapt to emerging technologies.
The findings indicate that the transformative nature of AI makes it an appealing asset for criminals. In particular, the rise of generative AI has made it easier for individuals to engage in digital crimes.
According to the report, AI enables criminals to craft messages in various languages, allowing them to target victims more accurately and on a global scale. Additionally, it has facilitated the creation of malware and child exploitation materials.
The Role of AI and Crypto in Criminal Activities
The agency also mentioned that the automation features of AI have significantly enhanced the effectiveness of criminal operations. Criminals can now automate their phishing efforts with AI, reaching a wider array of victims through large-scale cyberattacks.
Realistic synthetic media allows criminals to trick victims by impersonating others and engaging in blackmail. The organization made a noteworthy comment:
“The inclusion of AI-powered voice cloning and live video deepfakes intensifies the threat, enabling innovative forms of fraud, extortion, and identity theft.”
On February 13, a blockchain analytics company pointed out that generative AI is “amplifying scams.” They emphasized that AI helps make scams cheaper and more scalable. The head of fraud products at the firm remarked that AI enables the creation of fake identities, which allows scammers to impersonate legitimate users.
Beyond AI, the report highlighted how blockchain technologies, such as cryptocurrency and non-fungible tokens (NFTs), have expanded beyond cybercrime and infiltrated traditional crime sectors, including drug trafficking and human smuggling.
The agency has also observed the emergence of new criminal schemes aimed at stealing crypto, NFTs, and resources utilized for cryptocurrency mining.
Recent Developments in Crypto Security
A notable recent incident in the cryptocurrency realm is the Bybit hack, which resulted in nearly $1.5 billion in losses. A crypto investigator commented on a social platform that this breach has been “eye-opening,” exposing the significant vulnerabilities within the industry.
The investigator expressed concerns that without government intervention to implement strict regulations, the industry may struggle to rectify its issues. While assisting in freezing funds linked to the hack, they identified weaknesses in both decentralized and centralized systems. The investigator noted:
“Several ‘decentralized’ protocols have recently relied almost entirely on funds from North Korea and show no willingness to accept responsibility.”
Moreover, they pointed out that centralized exchanges are often worse, as they take considerably longer to respond to illicit fund flows, exacerbating the laundering process.
In Summary
The complexities and challenges posed by AI and cryptocurrency within the realm of organized crime are becoming more apparent, highlighting the need for better security measures and regulatory frameworks to combat these evolving threats.