The crypto cop at the United States Department of Justice (DoJ) is intensifying efforts to combat hackers and exploiters within the Decentralized Finance (DeFi) space. This is in response to the steady increase in unlawful crypto-related transactions over the past four years.
DoJ Official Reveals Plan
According to reports, Eun Young Choi, the head of the National Cryptocurrency Enforcement Team (NCET) at the Department of Justice, revealed that the agency had set its sights on investigating DeFi-related thefts and hacks, with a particular emphasis on “chain bridge. Choi emphasized that the emergence of North Korean “state-sponsored hackers” as top players in the DeFi space and has presented another concern for the Department of Justice.
It is a matter of great significance for the agency. Known as the “Lazarus Group,” the North Korean-based hacking unit has been suspected to be the mastermind behind several top hacking attacks on DeFi platforms in the past few months.
Reports estimate that North Korean hackers managed to steal approximately $630 million to $1 billion worth of cryptocurrency assets throughout 2022. In February 2022, the DoJ appointed Choi as the pioneer director of the NCET.
With nearly a decade of prosecutorial experience within the agency, Choi’s selection for this role highlights the importance of her expertise and experience. During the announcement, the Department stated that the establishment of the NCET would play a pivotal role in addressing a range of issues, including cryptocurrency, cybercrime, money laundering, and asset forfeiture.
The Department emphasized that the NCET would serve as a central hub, effectively consolidating efforts and expertise to combat these challenges. While emphasizing “mixing and tumbling services” as a specific area of focus, the Department of Justice did not explicitly mention any DeFi platform.
During her recent appearance at a Crypto Summit, Choi reiterated the Department of Justice’s commitment to pursuing crypto firms involved in illicit activities or using their platforms to facilitate illegal activities. According to her, the DoJ will go after the source of illicit transactions on any crypto platform to make it difficult for malicious actors to continue with such harmful acts.
Furthermore, Choi reiterated that the scope and scale of using digital assets for criminal activities have increasingly grown in the last four years.
Combatting Illicit Activities Within The Crypto Space
As part of its oversight, the Department of Justice has initiated an investigation into Binance regarding a potential violation of sanctions imposed on Russia. The DoJ is actively examining whether individuals from Russia were able to gain access to the exchange, leading to the launch of this probe.
In addition to its investigations and efforts to combat illicit activities within the cryptocurrency space, the Department of Justice has also been involved in several asset seizures. One such instance occurred in April during a crackdown on a pig butchering scam, where the DoJ seized control of approximately $112 million worth of crypto and other related assets.
Furthermore, the DOJ is investigating the sudden shutdown of Silvergate Bank, a crypto-friendly bank that collapsed recently. In another development, lawmakers and regulators in the United States are reportedly working together to create comprehensive crypto legislation.
In response to ongoing criticisms regarding the absence of comprehensive crypto regulation, the United States is preparing to introduce more substantial regulatory measures. Congress recently convened a hearing to discuss crypto regulation, providing an extensive overview of potential approaches to regulating the crypto industry.
In addition to the above developments, several other notable actions are being taken by authorities regarding the cryptocurrency landscape. One such prominent measure is President Biden’s widely discussed DAME tax on cryptocurrency mining, which aims to address the environmental impact associated with mining activities.
This initiative, coupled with the intensified scrutiny of the industry, aligns with Biden’s earlier commitment to fostering secure and sustainable growth in the digital asset sector.