Europol points out that the use of cryptography in crime is becoming ‘increasingly sophisticated’

Burkhard Mühl, director of Europol’s European Financial and Economic Crime Center (EFECC), this week pledged continued investment from Europol to assist member states in complex international investigations, warning that the misuse of cryptocurrencies and blockchain for criminal purposes is “increasingly sophisticated”.

“Investigating these crimes places a huge burden on law enforcement agencies in EU member states,” he added.

His comments were presented at the 9th World Conference on Criminal Finance and Cryptoassets, co-organized by Europol, the United Nations Office on Drugs and Crime (UNODC), and the Basel Institute for Governance, held on October 28-29, and focused on the evolving ways in which cryptoassets and blockchain are being exploited for crime.

Although only a small portion of overall financial crime proceeds, Chaina Analysis’s 2025 Cryptocurrency Crime Report: released In January, the professor gave a lower estimate of the value that illicit cryptocurrency addresses would receive in 2024, at $40.9 billion. This figure does not include traditional crimes such as drug trafficking, where cryptocurrencies are simply used as payment or laundering tools.

Europol has coordinated several major busts this year, including the dismantling of a Latvian cybercrime network. washed Cryptocurrency, over $330,000 through secret hawala banking network washed More than $23 million spent in cryptocurrencies and “cryptocurrency investment fraud group” made a profit Approximately $540 million was paid out by more than 5,000 victims.

Europe has also seen a spate of so-called wrench attacks in which crypto holders are physically assaulted and forced to hand over their private keys to their wallets. In particular, 16 such attacks have occurred in France this year alone. record Records of “known physical Bitcoin attacks” kept by Jameson Ropp.

The challenge for many law enforcement agencies targeting cryptocurrency-related crime lies in its global nature and the need for cross-border cooperation in operations, which can sometimes be difficult to achieve. For example, victims of hacking and fraud in Europe may be targeted by people operating elsewhere.

Challenges also remain in how law enforcement and the private sector investigate crimes. Investigators say the lack of uniform standards remains a significant hurdle. Diana Patrush, project manager at the Blockchain Intelligence Professionals Association (BIPA) said: decryption Different analysis companies often produce inconsistent trace results, complicating cross-border collaboration.

“Our stakeholders have made it clear that different blockchain analysis companies provide different results when tracking transactions. There is also no standardization of wallet attribution, methodology, training, or format, making cross-border investigations particularly difficult,” Patrush said.

“We are at the very beginning of this process. To make real progress, we need to encourage more dialogue so that stakeholders in both the public and private sectors can come together to co-develop these standards and, more importantly, adopt them wholeheartedly,” she said.

Patrush added that training is also an area that needs to continue to be worked on.

“The biggest issue we see at the moment is that blockchain intelligence training appears to be primarily driven by private sector solutions. This creates confirmation bias and steers trainees toward specific commercial solutions and methodologies without necessarily understanding or evaluating the underlying applications,” she explained.

“Investigators and financial institutions need to develop their own critical assessment capabilities,” Patrush suggested, pointing to a “skills gap” particularly around open source tools and the technology behind cryptocurrencies.

Patrush also cautioned against oversimplifying what qualifies as a “crypto-related” crime or comparing the scale of crypto crimes to traditional financial crimes.

“As there is no universally accepted definition of what constitutes crypto-related crime, it is difficult to determine whether crypto crime is significantly more prevalent compared to traditional financial crime, and there is a risk that the narrative may be captured depending on the objectives of those looking at the data,” she said.

“Perhaps it would be more useful to look at financial crime in general and recognize that as crypto assets, stablecoins, and tokenized assets enter mainstream financial markets, crypto-related crime plays an important and growing role that must continue to be managed.”