Li Jing
In a startling revelation, the cryptocurrency tracing firm Chainalysis has uncovered a worrying trend in the illicit trade of child sexual abuse materials (CSAM). The sellers of these materials are increasingly employing advanced methods like “mixers” and “privacy coins” such as Monero, complicating efforts by law enforcement agencies to track and apprehend them.
The internet’s darkest corners, where CSAM is bought and sold, have long used cryptocurrencies like Bitcoin as a medium of exchange. This bypasses traditional financial institutions and keeps transactions hidden from the prying eyes of law enforcement. However, Bitcoin’s public and traceable transaction ledger has occasionally led investigators to the perpetrators. In response, these criminals have evolved their tactics.
Chainalysis’ annual crime report highlights an alarming growth in the sophistication of crypto-based CSAM transactions. While the total revenue from CSAM sold for cryptocurrency has declined since 2021, the complexity and stealth of these transactions have markedly increased. This change is attributed to the increased use of cryptocurrency mixers – services that mingle user funds to obscure their origin – and privacy coins, which enhance transaction anonymity.
In 2023, CSAM vendors persisted online and evaded law enforcement longer than in any previous year. This increase in online duration, about 57% longer than in 2022, is a direct consequence of their growing crypto-savviness. Chainalysis found that approximately 46% of CSAM vendors used mixers in 2023, a significant jump from about 22% in 2020. Additionally, there’s a rising trend of these vendors using “instant exchanger” services to convert Bitcoin into more secretive cryptocurrencies like Monero.
The utilization of Monero, in particular, has been linked to the prolonged activity of CSAM vendors online. Monero’s design, which focuses on privacy, makes it a preferred choice for these illicit traders. Chainalysis’ data indicated that CSAM vendors who used Monero-friendly instant exchangers had a higher survival rate online compared to those who did not.
Despite these challenges, the overall scale of CSAM-related cryptocurrency transactions decreased by 22% from 2022 to 2023, with fewer new CSAM vendors accepting crypto. This decrease might partly result from a growing awareness within the CSAM underground of the traceability of cryptocurrencies, spurred by high-profile law enforcement cases.
The rise of sophisticated cryptocurrency use in CSAM trading presents a complex challenge for law enforcement. While traditional tracing methods have made significant strides, the adoption of privacy coins like Monero by CSAM sellers necessitates a more advanced approach and specialized blockchain analysis services. This ongoing cat-and-mouse game underscores the necessity for continuous adaptation and innovation in the fight against digital child exploitation.