- CoinJoin Bitcoin transactions tripled since 2022, driven by whale addresses linked to ETFs and custodial wallets.
- Bitcoin thefts in 2024 rose 21%, totaling $2.2 billion, with notable attacks on DMM and WazirX exchanges.
- Unidentified whales secretly accumulated over 420,000 BTC, worth $40 billion, fueling speculation about nation-state involvement.
Private Bitcoin transactions using the CoinJoin process have tripled since 2022. CryptoQuant attributes this rise to Bitcoin whale addresses linked to exchange-traded funds, MicroStrategy, and custodial wallets. As CryptoQuant’s Ki Young Ju noted in a Dec. 26 post, these whales utilize privacy transactions to transfer funds to institutional investors.
Ki Young Ju dismissed concerns that CoinJoin is primarily used by hackers to launder stolen funds. He emphasized that Chainalysis’s $2.2 billion reported losses in 2024 represented just 0.5% of Bitcoin’s total realized market cap.
Bitcoin Whales Accumulate 420,000 BTC Amid Speculation
Chainalysis’s annual cryptocurrency theft report revealed that 2024 saw a 21% rebound in theft activity compared to a decline in 2023. The total stolen reached $2.2 billion, with significant thefts including a $305 million attack on Japan’s DMM Bitcoin exchange in May and a $235 million theft from India’s WazirX in July. Chainalysis recommends using multi-factor authentication, updating passwords regularly, storing private keys offline, and choosing platforms with strong security protocols and insurance coverage to mitigate risks.
Despite the requirement for public-listed firms to disclose their holdings, some unidentified Bitcoin whales have accumulated over 420,000 BTC, worth more than $40 billion. Speculation has arisen about the potential involvement of nation-states secretly building Bitcoin reserves or sanctioned countries using Bitcoin to circumvent financial restrictions.
Russia recently enacted legislation allowing foreign trade in BTC and other digital financial assets (DFAs). Russian Finance Minister Anton Siluanov confirmed that such transactions are already in use and that the government plans to expand this system further. The move demonstrates the growing adoption of Bitcoin in global trade, particularly by countries exploring alternatives to traditional financial systems.
CoinJoin Misuse Raises Law Enforcement Concerns
CoinJoin’s potential for misuse has caught the attention of law enforcement, particularly in the United States. In April, U.S. authorities arrested the founders of Samourai Wallet, a privacy-focused Bitcoin service. The U.S. Department of Justice accused Samourai of enabling $2 billion in illegal transactions and facilitating money laundering from dark web markets.
Blockchain data revealed that U.S. authorities had seized over $1.9 billion worth of BTC from the Silk Road marketplace, highlighting the intersection of privacy tools and regulatory efforts to combat illicit activities. Additionally, Russian courts sentenced Hydra Market founder Stanislav Moiseev to life imprisonment for his involvement in online black-market activities.
The conviction of Alexey Pertsev, developer of the Tornado Cash cryptocurrency mixing protocol, raised alarms about legal implications for open-source developers. Dutch judges sentenced Pertsev to five years and four months in prison for laundering $1.2 billion in illicit funds, despite Tornado Cash’s noncustodial nature, where the platform never controls funds.
Pertsev’s case, which followed Tornado Cash’s U.S. blacklisting, underscores the growing risks faced by developers of privacy-enhancing tools. His legal team plans to appeal, and the case sets a critical precedent for the accountability of those involved in open-source projects with potential misuse in illicit activities.
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