Digital currencies, money laundering and countermeasures in international law

Document Type : Original Article

Authors

1 Master of Private Law, Bushehr Branch, Islamic Azad University, Bushehr, Iran

2 Assistant Professor, Department of Management, Lamerd Branch, Islamic Azad University, Lamerd, Iran (Corresponding Author)

10.30510/psi.2022.291662.1860

Abstract

The purpose of this study was to investigate the relationship between digital currencies, money laundering and strategies to combat it in international law. Money laundering is defined as an attempt to conceal the identity of illicit proceeds and attempt to legitimize them; Criminals act in various ways to hide the illegal origin of their funds, but one of the easiest ways is to trade these dirty currencies in the name of digital currencies. The best way to combat money laundering through digital currencies is to monitor Chinese blockchain transactions that are potentially suspicious. In discussing investigations into illegal activities such as money laundering, the transparent nature of cryptocurrency transactions puts this financial structure at the forefront. Unlike traditional currencies, which are no longer traceable when lost, cryptocurrency funds have a high trackability. Suspicious Chinese block transactions can be monitored by tracking direct and indirect communications created through these transactions and by tracking potentially illegal sources of cryptocurrencies. The hidden identities of buyers and sellers of digital currencies, lack of government control and the impossibility of documenting money laundering documents in digital currencies are the most important reasons for using digital currencies as money laundering tools. Legislation for digital currencies, especially bitcoin, can be described as anti-money laundering strategies.

Keywords

Political Sociology of Iran
Volume 5, Issue 11
January 2023
Pages 3766-3774

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