Nasdaq's Report Highlights Trillions in Illicit Funds, Omits Crypto's Role in Financial Crime
Summary:
Nasdaq's inaugural Global Financial Crime Report 2024 disclosed that about $3.1 trillion of illicit funds flowed through the global financial system in 2023. The report, which surprisingly omitted any mention of Bitcoin or crypto, highlighted the pervasive role of fiat in facilitating financial crime. CEO Adena Friedman emphasised the effort of financial institutions in preventing financial crimes, albeit asserting that it's a collective responsibility. Tether CEO, Paolo Ardoino, mirrored this view and emphasized the importance of collaboration with law enforcement to tackle these crimes. A separate report by Chainalysis stated stablecoins as the criminals' preferred cryptocurrency in 2022-2023. Interestingly, neither BTC nor crypto was listed as conduits for crime in the Nasdaq report.
Nasdaq, the stock exchange corporation, recently published its inaugural Global Financial Crime Report 2024, providing a detailed overview of fiscal misconduct throughout the preceding year. Interestingly, the report didn't mention Bitcoin (BTC) or cryptocurrecy as conduits for crime, reinforcing the belief that physical money, or fiat, remains the primary instrument in criminal operations. The report revealed that financial criminal activity constitutes a problem worth several trillion dollars. Proceeds of illicit activities to the tune of $3.1 trillion were circulated within the global finance system in 2023, according to Nasdaq's estimate. This laundered money supported crimes such as drug trading, human trafficking, and the financing of terrorism.
The report by Nasdaq shed light on the specific allocation of the illegal funds; $782.9 billion was related to drug trafficking activities, and $346.7 billion was associated with human trafficking. Additionally, approximately $11.5 billion was allocated for the financing of terrorism. Beyond these atrocities, fraudulent activities and bank scams caused a loss of $485.6 billion in 2023.
In the report, Nasdaq's chief executive officer, Adena Friedman, emphasized the central role financial institutions have played in combating this issue over many years. Despite the mounting pressure, these institutions remain steadfast in their efforts to curb fraudulent activities. Nonetheless, she cautioned that a solitary entity, industry, or government cannot eradicate this multifaceted problem. Instead, she encouraged global cooperation and collective responsibility.
Echoing Friedman's sentiment, Tether's CEO, Paolo Ardoino, labelled the fiscal crime issue worth several trillion dollars as 'extremely' concerning in a statement issued to Cointelegraph. The Tether executive underscored the importance of worldwide cooperation in combating illegal activities. Ardoino added that Tether maintains partnerships with law enforcement agencies globally, freezing any addresses or wallets connected to criminal operations and urged traditional financial institutions to follow suit.
A report shared by blockchain analytics firm Chainalysis on January 18 asserted that within the cryptocurrency domain, stablecoins were the preferred medium of transactions among criminals in 2022 and 2023. The volume of unlawful transactions involving stablecoins exceeded those of Bitcoin (BTC), Ether (ETH), and other altcoins.
Nevertheless, Gabor Gurbacs, digital assets strategy director at investment firm VanEck, highlighted that Nasdaq's report did not reference BTC, crypto, or stablecoins. Gurbacs drew attention to the primary role of banks and institutions in enabling criminal activities.
Published At
1/24/2024 1:57:27 PM
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