How Cryptocurrencies Are Being Used By Criminals & Can It Be Stopped?

Law enforcement is concerned that virtual currencies such as bitcoin — already known to be used for illegal transactions, including sex and drug trafficking — can play a much larger crime role as more investors use it as their preferred payment option.

Digital or virtual currency, frequently referred to as cryptocurrency, is not governed by any central authority or government. Although local entrepreneurs say cryptocurrency has many legitimate uses, the speed and relative secrecy of these trades have also been proven to draw criminals.

Some offenders use bitcoin because users can open a pocket to ship and get bitcoin without providing a name or identity. There's not any bank or central authority, like a government, to control this information. Bitcoin also became a favorite method for making payments when a computer system is taken over by ransomware.

Bitcoin is not entirely anonymous and transactions can be traced by authorities through bitcoin trading sites. Other cryptocurrencies, such as Monero, are becoming popular for dark web uses including drug trafficking and human trafficking, said Jad Mubaslat, Wright State University graduate student and creator of, a bitcoin trading platform.

The listing of all bitcoin exchanges and transactions are recorded on what's called the blockchain, which will be a network of computers that are decentralized. Mubaslat said police do find strategies to track transactions, and internet bitcoin trading platforms frequently have open communication with law enforcement.

Locally, there are instances of bitcoin being used in crimes. Springboro teacher Amy Panzeca allegedly assisted her 16-year-old son obtain bitcoin used to buy LSD, and she's charged with child endangering and contributing to the unruliness of a minor.

The 16-year-old boy was sentenced earlier this month to 30 days at the Warren County Detention Center, arranged to finish an abysmal treatment program and put on probation for drug charges. The mother currently on leave from her job at the school district.

A spokesman for the Federal Bureau of Investigation said he wasn't conscious of any national investigations from the southwest Ohio area that involved bitcoin or other cryptocurrency. “It doesn't signify that they don't exist,” said Todd Lindgren, FBI spokesman.

Bitcoin Used in Sex Eommerce

One of the big worries of law enforcement is the impact crytocurrency is currently having on the sex industry. removed its adult content section from the classified website in early January, citing “unconstitutional government censorship. reported the government forced credit card companies to stop doing business with Backpage.

Talbott isn't opposed to cryptocurrency, but he explained it plays a role in prostitution and sex trafficking. “With anything else, regular money is utilized for offenses,” he said. “People can't state that cryptocurrency is inherently bad because it's used for crime.”

Credit cards are no longer a choice to utilize on for paid “dating” ads, so individuals who wish to post advertisements need to pay in bitcoin. The paid advertisements brought in earnings for websites like backpage or alternative sites with adult interests sections.

‘Adaptive' Law Enforcement

Cuyahoga County Sheriff's Sgt. Jim Mackey, a helper task force director for the Ohio Human Trafficking Task Force, stated women involved in prostitution or sex trafficking will pay someone cash to post the ads with bitcoin. He said a woman that they recently “recovered” paid a man $200 to place sex advertisements for her.

“We do see it. It's generally not with Johns paying for women,” he explained. “It's usually the girls or the traffickers which are using the bitcoin to spot ads on or other websites. There are a few related to that.”

Presently, it's less mainstream yet in small sex trafficking busts and authorities have the ability to monitor trades. Mackey believes it could be even simpler to track because there's a trade of money transfer.

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