Criminals who use cryptocurrency to commit crimes are more likely to receive a harsher sentence in Australian courtsaccording to a new study.
The study, titled “Crime and Cryptocurrency in Australian Courts,” published Monday in the Monash University Law Review, found that the use of cryptocurrencies in criminal activity was seen as indicative of a greater “degree of planning” and sophistication, leading the court to “consider general deterrence above other sentencing purposes”.
“Obtaining and using cryptocurrencies for payments requires a higher degree of technical skill compared to the general population, who may not be familiar with these payments.”
The study looked at 103 cases brought in Australian courts between 2009 and 2020.and focused on 59 criminal cases and their sentencing procedures.
not so sophisticated
Study authors Aaron Lane and Lisanne Adam found that Australian courts generally perceive the use of cryptocurrencies as indicative of “technical sophistication” and “intentional obfuscation”.
Nevertheless, the pair argued that Australian courts may be “too eager to adopt a relatively simplistic characterization” of cryptocurrency use in criminal activity, arguing that not all cryptocurrency use may signify the same level of sophistication.:
“Sophistication exists on a spectrum.”
Courts must be able to differentiate between the different types of cryptocurrency transactions used by perpetratorsespecially as the mainstream adoption of digital assets continues to grow.
Perpetrators who used centralized crypto exchanges – where Know Your Customer (KYC) requirements mean identification can be easily obtained – cannot be treated similarly to criminals who intentionally use anonymous wallets. non-custodial or blending services to hide transaction data.
Cryptocurrencies and digital assets have long had a reputation for being linked to illegal activitieslikely due to bitcoin’s initial association with the infamous Silk Road darknet black market.
Although this negative association still hangs over the digital assets sector, the amount of crypto used for illicit activities has never been lower.according to a recent report by CipherTrace.
The report estimated that illicit activity was between 0.62% and 0.65% of global cryptocurrency activity in 2020 and has since dropped to between 0.10% and 0.15% of global activity throughout 2021.
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