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Dirty Bitcoins: How to Conduct an Anti-Money Laundering Check on Your Crypto

What is a dirty bitcoin? A coin is considered “dirty” if it’s been involved in any illicit activity such as: Crypto crimes like wallet or exchange hacks; Money laundering, which includes criminals trying to hide the proceeds of their illegal activities by converting them into crypto (spoiler: it doesn’t work); Scams such as fraudulent schemes … Continued

The post Dirty Bitcoins: How to Conduct an Anti-Money Laundering Check on Your Crypto appeared first on BeInCrypto.

Republished by Plato



Some researchers say that over 40% of all bitcoin (BTC) transactions are linked to crime. Owning “dirty” coins can get you in serious trouble, even if you didn’t participate in any illegal activity. Is this something you personally should be worried about, and if so, how can you conduct an anti-money laundering (AML) check on your crypto?

What is a dirty bitcoin?

A coin is considered “dirty” if it’s been involved in any illicit activity such as:

  1. Crypto crimes like wallet or exchange hacks;
  2. Money laundering, which includes criminals trying to hide the proceeds of their illegal activities by converting them into crypto (spoiler: it doesn’t work);
  3. Scams such as fraudulent schemes and projects;
  4. Darknet marketplaces, or hidden sites where users buy and sell drugs, stolen credit card details, and other illegal goods for crypto.
Here’s what a darknet marketplace looks like. Source: AMLBot

Dirty coins can be identified through AML checks. Note that a coin can be considered dirty even if it doesn’t come directly from an illegal or fraudulent source. For instance, BTC coming from unregistered exchanges or mixing services will be flagged by any established crypto AML program.

What are the risks?

The bad news is that even if you have no idea that some of your coins are dirty, you can still suffer some losses. Here are some possible consequences of not running an AML check:

  1. Not being able to sell your coins at current market prices. Reputable exchanges won’t convert suspicious coins into USD and other fiat currency. To sell dirty tokens, you’ll have to use a peer-to-peer (P2P) platform or a minor exchanger that will charge a higher commission. Sometimes dirty bitcoins are even sold at a discount of 10% to 20%, or more.
  1. Getting blocked on an exchange. Most major exchanges – and all regulated ones – use special tracing software to detect dirty crypto. Once you try to deposit suspicious coins, the exchange will stop you from making any new transactions until you can prove the origins of the crypto. This is a real problem that is often discussed on Reddit:
A screenshot of a Reddit post. Source: AMLBot
  1. Losing your crypto. If you can’t provide any supporting documentation in relation to your source of funds, the exchange will not only block the account permanently, but also won’t let you withdraw any of the coins on your balance. Say goodbye to your satoshis!
  1. Dealing with law enforcement. Exchanges can report any evidence of a crime to the financial police that will probably want to question you. Even if you can prove that you didn’t commit whichever crime your bitcoins were involved in, you’ll still lose the coins because normally proceeds of crime are forfeited. 
  1. Serious legal trouble. In the worst-case scenario, you may be prosecuted as an accomplice or accessory to a financial crime.

How does AML software detect dirty bitcoins?

Anonymity and privacy are the two advantages of crypto that people usually get excited about. Indeed, bitcoin is anonymous in the sense that you don’t have to enter your personal information when you create a wallet.

However, bitcoin is also highly traceable – every bitcoin transaction leaves a digital trail, which makes it possible to follow. You can easily trace the majority of coins, except for the privacy-oriented ones like Monero (XMR), although even those aren’t immune.

In case you’re wondering whether you can check the origin of the received coins on your own, without using any dedicated AML software, the answer is no. You can conduct some preliminary research using a blockchain explorer like or Etherscan to see the list of all the transactions associated with the wallet address that sent you the coins.

Keep in mind that these tools won’t reveal the person behind the addresses. Also, criminals usually use dozens or hundreds of dummy wallets to cover up their tracks, so you’ll need considerable processing power and special algorithms to track them down. In fact, blockchain analysis software is a booming industry!

Latest crime trends involving bitcoin

Some researchers, such as Foley et al., believe that 46% of all transactions with bitcoin are directly or indirectly linked to some illicit activity. However, judging by more recent data, the situation may not be as grim as it seems.

Crypto crime volumes seem to be decreasing. According to CypherTrace, the total value of crypto crimes in the first ten months of 2020 amounted to $1.8 billion, as opposed to $4.5 billion, in 2019. This includes hacks, theft, and darknet transactions. For instance, in September, 2020, hackers stole $150 million from KuCoin alone. A large percentage of these funds likely went to minor unregulated exchanges, where they were bought by unsuspecting users. 

Darknet marketplace activity is intensifying. A recent Chainalysis report suggests that almost $790 million in crypto was sent to and from darknet marketplaces, in 2019. 

Only a few among the richest bitcoin addresses hold over 1% in dirty or suspicious coins. We’ve conducted a study based on the data from AMLBot, an open crypto tracing software. Instead of trying to go through thousands of random addresses, we looked at the 100 richest BTC addresses, including those belonging to exchanges. 

A fragment from the AMLBot research report. Source: AMLBot

Interestingly, AMLBot flagged only six of the addresses as containing any BTC that came from the darknet. 15 addresses held some coins that came from mixers or scam projects. In total, the software ranked 47 out of the 100 as low-risk, 52 as medium risk, and just one as high risk.

That single very suspicious address is actually a super-whale with over $2 billion in bitcoins.

We concluded that, while quite common, illegal activity involving crypto isn’t something you should lose sleep over. But of course, this doesn’t mean you shouldn’t exercise caution.

How you can protect yourself

There are several efficient ways to avoid legal and other risks associated with dirty and suspicious crypto. Those are:

  1. Avoid using bitcoin mixers, cleaners, and similar services. While they do conceal the origin of the coins, any established tracing software will mark such transactions as coming from a mixer, which is a red flag for many exchanges. 
  2. Channel all incoming crypto funds into two separate wallets: “clean” and “potentially risky.” The first should contain coins coming from reliable business partners, regulated exchanges, mining pools, and services that have Know-Your-Customer (KYC) checks. Use the “clean” wallet only to send money to large trading platforms. By contrast, all the coins you receive from strangers, unofficial over-the-counter services, gambling sites, small exchanges,and others, should go into the “potentially risky” wallet.
  3. Use open crypto tracing software or a wallet that lets you buy bitcoin with a card and do an AML check at the same time. Such services are usually premium and charge either on a per-month or per-check basis. They deploy advanced algorithms similar to those utilized by the police and thus, can detect all or almost all suspicious coins.

Authorities take action to fight dirty crypto

With some help from blockchain analysts and powerful tracking software, the police regularly dismantle money-laundering rings and other crypto criminals. For example, in 2019, US law enforcement took down the world’s largest child pornography site, at the time, by tracking some BTC payments down to its founder. 

Apart from transaction checks, many countries use ever more advanced AML and KYC laws that oblige crypto platforms to verify their users’ identity and report such information to the authorities. The best example is the Fifth Anti-Money Laundering Directive (5AMLD), which came into effect in the European Union in January 2020. 

A combination of blockchain tracing software and AML legislation is making the crypto landscape safer for regular users. If you only use top exchanges and regulated services to buy crypto with a bank card, your risk of stumbling upon dirty BTC is pretty low. Still, it’s not a bad idea to check your crypto holding for “cleanliness:” who knows what you’ll find there?

NOTE: The views expressed here are those of the author’s and do not necessarily represent or reflect the views of BeInCrypto.

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Slava is a сertified AML specialist in the cryptocurrency field and an expert in crypto regulation and transaction monitoring. He has ab education in Information Networks Security, and has completed the course in Anti-Money Laundering Fundamentals in the European Institute of Management and Finance. Slava is the founder of AMLBot, a service for checking cryptocurrencies for connections with illegal activities. Also, he is the CEO of AMLSafe, a non-custodial wallet with an in-built crypto AML module. Since 2013, he has been managing the IT team and developing software for the blockchain market. Besides, Slava is a member of the Blockchain Association of Ukraine (BAU).

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Elon Musk Agrees to Have the Bitcoin Talk With Jack Dorsey

Republished by Plato



After laughing at Jack Dorsey’s proposition for a Bitcoin conference earlier, Elon Musk has actually agreed to a BTC conversation with the CEO of Twitter at the event.

  • As reported earlier, Elon Musk likes to have fun with the cryptocurrency community. Perhaps that’s why he initially laughed at Jack Dorsey’s most recent Bitcoin endeavor.
  • The CEO of Twitter announced plans to hold a designated BTC event aiming to “help protect and spread what makes bitcoin open development so perfect.”
  • After the initial laughter from Tesla’s CEO, though, Dorsey asked Musk to have a conversation at the event where the latter could share all of his “curiosities.”
  • Later on, Musk indeed agreed to have “THE talk” at the event, which should take place on the 21st of July this year.
  • Apart from Dorsey, some of the other popular names that will speak at the conference include the CEO and CIO of ARK Invest, Cathie Wood, and the CEO of Blockstream, Adam Back.
  • With this event, Twitter’s CEO continues to reaffirm his support for the primary cryptocurrency.
  • During the 2021 Bitcoin Conference in Miami, he called the asset the most important work of his lifetime. Furthermore, he said he would leave Twitter and Square if BTC needed him.
  • His personal Twitter account continues to display only one word – bitcoin. Additionally, he partnered with the legendary rapper Jay-Z to donate 500 BTC to fund developers working on the network.

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Bitcoin Hash Rate Goes On Death Spiral Post China’s Crackdown On Miners

Republished by Plato



The great Bitcoin miners migration is well underway. And the network’s total hash rate is showing it in a big way. Currently, the number of terahashes per second is at its lowest level in the last twelve months. That means that mining Bitcoin has not been easier in a whole year. Also, there’s less competition. So, it’s good news for all the other miners that are spread around the world. However, don’t expect it to last long.

Related Reading | How China Bitcoin FUD Is Lowering The Cost To Produce BTC

Tons and tons of mining equipment are currently traveling to their new homes. There are reports of a huge operation in Kazhakstan, a neighboring nation of China. There are also rumors of equipment and personnel already settling down in Texas. The US state is making a push to become a Bitcoin mining capital, and apparently, the efforts already bore fruit. 

Back in China, the crackdown is no longer a rumor. It’s a reality. CNBC reports:

China’s crackdown intensified over the weekend, with authorities in the hydropower-rich Chinese province of Sichuan ordering crypto miners to shut down operations.

According to reports, more than 90% of China’s bitcoin mining capacity is estimated to be closed. 

Some experts see this as a good thing. It’s estimated that China controlled between 60 and 70% of Bitcoin mining, and the future looks clearer with them out of the picture. The hash rate will suffer for a while, but there’ll be more decentralization. Also, the carbon-powered-energy consumption FUD will decrease. Even though China’s miners were mostly located in areas rich in renewable energy, Bitcoin critics had a hard time believing reports from that side of the world. 

Total Hash Rate (TH/s) of the Bitcoin network | Source:

Another China Ban, A Reflection Of 2017

This is not the first time that the Chinese government’s cryptocurrency policy caused havoc on the market. In September 2017, they banned crypto exchanges altogether. Just before that, Bitcoinist reported:

While Chinese exchanges used to represent over 90% of Bitcoin’s trading volume, this changed completely with the intervention of the PBoC which led to the end of margin trading and zero-fee policies and to the temporary halt on withdrawals.

All of these changes contributed to China’s trading volume reduction, which saw its market share fall to 3-5% of the global trading volume.

So, historically, the Chinese government has shown no mercy in closing billion-dollar businesses by decree. It’s also worth noting that most of the banned cryptocurrency exchanges just closed their China offices and moved their operation to other countries. They continue working to this day and, for users not in China, the traumatic move didn’t affect their experience in the slightest. Bitcoinist reports again:

The clampdown led to a staggering drop in CNY trading — which comprised over 90 percent at its peak — as traders made an exodus to over-the-counter, peer-to-peer, and foreign exchanges. As a result, jurisdictions with friendlier laws experienced a boom in trading volume as the market flipped on its head

The current situation with the miners is a reflection of that. The mining business is in the process of flipping on its head. The hash rate will recover.

BTCUSD price chart for 06/25/2021 - TradingView

BTC price chart on Bitstamp | Source: BTC/USD on

The Hash Rate Will Rise Again

In retrospect, we should’ve seen it coming. Only two months ago, following a suspicious blackout, NewsBTC reported:

According to the Beijing Economic and Information Bureau, there were concerns about the energy consumption related to these activities. PengPai quotes Yu Jianing, rotating Chairman of the Blockchain Special Committee of China, to claim that the country’s environmental requirements could lead to crypto mining being more “strictly regulated”. Jianing said this will be “inevitable”.

Related Reading | Bitcoin Mining In China To Usher Historic Moment, Will BTC Be Affected?

As for the possible reasons, Bitcoin Magazine’s Lucas Nuzzi cites the upcoming Digital Yuan CBDC. He also defuses the FUD by informing us, “Daily Hash Rate is, by its very design, a volatile metric that is not suitable to track lasting changes in the mining landscape.”

We should also take into consideration Nic Carter’s assertion that all of these things are happening while, “Bitcoin continues to maintain 100% uptime, is nothing short of a modern marvel.”

In Bitcoin, everything’s changing while everything stays the same. The hash rate will rise again.

Featured Image by OpenClipart-Vectors from Pixabay - Charts by TradingView and

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SOLANAX Private Sale Is On For The Cross-Chain DEX

Republished by Plato



[PRESS RELEASE – Please Read Disclaimer]

The cryptocurrency market has left people wondering about the long-term growth prospects and which cryptocurrency they should invest in. Solanax is an automated market maker (AMM) based on the Solana blockchain, which is set to be a game-changer in the cryptocurrency world.

The SolanaX Platform

After parsing through their team of professionals, whitepapers, their project plans, and unique platform capabilities, there is no doubt that once the platform is up and running in full swing, it will undoubtedly change the way people transact today with its simple interface for the public to trade at a record higher blockchain speed and lower gas fees.

  • There are no time-consuming processes or intermediaries.
  • It offers a very simple interface and lower gas fees while initiating the transactions.
  • Solanax increases blockchain speed and makes it more convenient to transact than its peers in the cryptocurrency market.
  • As Solanax is based on Solana’s Proof-of-History verification concept rather than a Proof-of-Work system (as that of Ethereum’s), it will enable users to leverage Solanax’s phenomenal transaction capabilities (Solanax to handle thousands of transactions in a second as compared to Ethereum’s 15).
  • The most crucial part is that while speeding up blockchain transactions and lowering gas prices, Solanax does not compromise on the security aspect.

The Ongoing Private Sale Of Solanax

Solana blockchain is substantially faster compared to its peers, and the ongoing private sale is an opportunity for crypto enthusiasts and investors to participate in this game-changer prospect.

The private sale is still ongoing until Friday, 25th June.

Total Supply: 80 000 000 SOLD Tokens

There will be 20 Million SOLD Tokens distributed before the CEX listing.

Private Sale: Total available token supply – 10,000,000 SOLD

Period: From 06/06/2021 to 25/06/2021

Token Price: $0.1 with a 3months vesting period

Token Price: $0.15 w/o vesting period

Initial Exchange Offering: Total available supply – 10,000,000 SOLD

Final Words

Solanax aims to revolutionize the DeFi exchange network and enhance efficiency levels to new highs. With DeFi gaining popularity, there is an urgent need for the industry to look beyond the older cryptocurrency platforms like Bitcoin and Ethereum. The sluggish transaction speed is one of the prime reasons for Solanax not preferring the Ethereum-like platforms. Besides, Solanax, with its high blockchain speed, simple interface, and low gas fees, is truly a game-changer for crypto aficionados, and Solanax’s Ongoing Private Sale presents the perfect investment opportunity for investors.


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