AI and Crypto Drive Criminal Efficiency: Europol

Artificial intelligence (AI) and cryptocurrency have long been touted as revolutionary technologies, but a recent report by Europol suggests that they may also be fueling the efficiency of organized crime across Europe. The European Union Agency for Law Enforcement Cooperation has released a comprehensive threat assessment report on serious and organized crime, highlighting the role that AI-driven automation and crypto tools play in scams, phishing, trafficking, and financial crimes.

AI's Transformative Qualities

Europol's report states that AI has "lowered the barriers to entry" for digital crimes, making it an attractive tool for criminals. The agency notes that AI allows malicious actors to craft messages in multiple languages, targeting victims more precisely and globally. This capability enables criminals to deceive victims with realistic synthetic media, impersonate individuals, and even blackmail their targets.

Generative AI has also been found to facilitate the creation of fake identities, allowing fraudsters to impersonate real users. As Chainalysis' head of fraud products, Elad Fouk, notes, "AI is amplifying scams" by making them more affordable and scalable. The analytics company warns that AI-facilitated scams are becoming increasingly sophisticated, posing a significant threat to global security.

Blockchain-Based Technologies Beyond Cybercrime

Beyond their role in cybercrime, blockchain-based technologies like cryptocurrency and non-fungible tokens (NFTs) have also been implicated in other traditional crime areas. According to Europol, there has been an increase in drug trafficking and migrant smuggling cases involving these technologies.

Furthermore, more criminal schemes have emerged to steal crypto, NFTs, and resources used to mine crypto. The most recent high-profile incident, the Bybit hack, led to nearly $1.5 billion in losses. Crypto sleuth ZachXBT has expressed concern about the lack of regulation in the industry, stating that it may be "unbelievably cooked" with hacks and exploits.

ZachXBT's investigation into the Bybit hack revealed flaws with decentralized and centralized protocols, including weaknesses in Know Your Transaction (KYT) and Know Your Customer (KYC) protocols. The crypto sleuth notes that North Korean hackers laundering funds through these protocols have demonstrated the vulnerabilities of the industry.