Roundup: Higher for Longer
Zack Morris | Research Analyst
May 2, 2024
DOJ, FBI Hit Crypto Headlines
The co-founders of bitcoin wallet and mixing service Samourai Wallet were arrested and charged with money laundering and unlicensed money transmitting by the Department of Justice last week.
Bitcoin transactions are publicly recorded on the blockchain, making it possible to trace the transaction history of a specific coin. A mixing service improves user privacy by taking bitcoins from multiple users, mixing them together, and then redistributing them to new addresses, thereby anonymizing the coins and breaking the traceability between transactions.
The DOJ alleges that the defendants “encouraged and openly invited users to launder criminal proceeds through Samourai.”
The arrests come as the government prepares for its case against developer Roman Storm, who was arrested last year for his work on the Tornado Cash mixing service, which has been used by North Korean hackers to launder funds.
According to CoinDesk, Storm’s legal team is arguing that the developer never aided these groups, but rather “just published code that anyone can use.”
In conjunction with the arrests, the FBI put out a warning Americans to not use non-KYC crypto wallets as they may not adhere to anti-money laundering requirements.
