German authorities have shut down 47 cryptocurrency exchanges, accusing them of facilitating an “underground economy” for cybercriminals. The crackdown is part of a broader effort to combat money laundering and illegal activities in the crypto space.
In a joint statement on 19 September 2024, the Federal Criminal Police Office, Frankfurt’s main prosecutor’s office, and the country’s cybercrime agency alleged that the exchanges deliberately concealed the origins of illicit funds.
The platforms allegedly failed to implement legal requirements aimed at preventing money laundering on a large scale.
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Users Of Confiscated Exchanges Include Ransomware Operators
The users of the confiscated exchanges allegedly include ransomware operators, botnet controllers, and black market traders who exploited the services to convert illegally obtained funds into the legitimate financial system.
The websites of the seized exchanges now display a stark warning from the German government. It states that all servers and data have been confiscated.
“We have their data—transactions, registration data, IP addresses,” the authorities stated. “Our search for traces begins. See you soon.”
Despite the seizure, the authorities acknowledged the limitations of their reach, noting that many perpetrators reside abroad, often in countries that tolerate or even protect such activities. This complicates the prosecution of those involved.
Germany seizes 47 crypto exchanges used by ransomware gangs: German law enforcement seized 47 cryptocurrency exchange services hosted in the country that facilitated illegal money laundering activities for cybercriminals, including ransomware gangs. I…] #Security pic.twitter.com/KbNfuwuwi7
— PJ Cyber Security School (@PJ_Professional) September 19, 2024
One of the targeted platforms, Xchange.cash, had reportedly processed nearly 1.3 million transactions for 410,000 users since 2012. Other major exchanges like 60cek.org, Baksman.com, and Prostocash.com were also among those that were shut down.
The crackdown follows the German government’s recent sale of nearly 50,000 Bitcoins, worth approximately $3.15 billion, seized from the piracy site Movie2k.to in 2020.
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Germany Cracks Down On Crypto ATMs
Last month, Germany’s Federal Financial Supervisory Authority (BaFin) launched a crackdown on unauthorized crypto ATMs, seizing 13 machines from 35 locations across the country.
As reported, the operation was carried out in collaboration with the Federal Criminal Police Office, local law enforcement, and the Bundesbank. It also resulted in the seizure of $28 million in cash.
The seized ATMs were reportedly installed illegally, with operators failing to register them under Section 32 of the Banking Act, which governs financial services in Germany. BaFin stated that the exchange of euros for cryptocurrencies through these unregistered machines constitutes a violation of the Banking Act.
German authorities warned that unregulated crypto ATMs could become hubs for criminal activities, particularly if operators do not implement strict Know Your Customer (KYC) protocols for transactions exceeding 10,000 euros.
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Disclaimer: Crypto is a high-risk asset class. This article is provided for informational purposes and does not constitute investment advice. You could lose all of your capital.
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