It seems that now almost everyone knows what blockchain, cryptocurrencies and transactions are. Briefly, blockchain is a technology that helps create cryptocurrencies, store them and exchange them. The transfer of cryptocurrency from wallet to wallet is called a transaction, although other important confidential information can also be transmitted using transactions.

Let's talk about the types of transactions we most often encounter or simply hear about.



Type of cryptocurrency transactions: Darknet transactions

The darknet is that part of the internet where ordinary search engines cannot peek. It is a place where sellers of contraband, drugs and child pornography do business.

In fact, the darknet would have a very hard time if there were no cryptocurrencies.

The US Drug Enforcement Administration (DEA) in its 2017 report says:

"Bitcoin is the most common form of payment for drugs on the darknet, which is becoming increasingly popular in international transactions of illegal funds."
Type of cryptocurrency transactions No. 3: money laundering

Previously, turning criminal proceeds into legal assets required processing a huge number of payments. However, today it is easier for criminals to handle this – even after a significant strengthening of anti-money laundering (AML) regulatory measures, since they began to use cryptocurrencies.

"97% of bitcoins received by cryptocurrency exchanges were directed to countries with weak anti-money laundering legislation," writes the website CipherTrace in its report for Q3 2018. "Cryptocurrency exchanges in countries with weak AML receive almost 5% of payments directly from criminal sources."
Now in China, where there are restrictions on the movement of funds, cryptocurrencies are used to evade these laws.

"Brokers of Chinese underground banking systems (CUBS) sell bitcoins to drug dealers for money received from drug sales in the USA, Australia and Europe," the DEA report states. "Many Chinese firms producing goods use trade-based money laundering (TBML) schemes and prefer to accept bitcoins. Bitcoin is very popular in China because it can be used to anonymously transfer value abroad — bypassing restrictions on the movement of funds in China."
Type of cryptocurrency transactions No. 4: ransom-demanding computer programs

Currently, ransomware viruses are slightly less popular than cryptojacking. Now organizing such an attack is not so difficult.

The head of the cybersecurity service provider company Mosaic451, Michael Baker, says:

"Ransomware as a service can now be bought cheaply on the darknet, and one supplier even offers user support for its malicious programs. All these services are bought and sold for cryptocurrencies."
Even ordinary phones are not protected from attackers who may hunt for your photos, emails and even data from fitness trackers.

Read also: The Christmas dump brought the price of bitcoin down to $3800
The US National Cyber Security Center in its report says:

"Viruses on internet-connected fitness trackers and televisions could become a problem for manufacturers. Perhaps such data will not be sold on criminal forums, however the devices and data themselves may turn out to be valuable enough for the victim, who will be ready to ransom them for cryptocurrency."
Type of cryptocurrency transactions No. 5: evasion of sanctions

Countries such as North Korea are in great need of hard currency, and cryptocurrencies provide them with such a chance.

Cryptocurrency analyst Lourdes Miranda from MirandaFinIntel Consulting and certified AML specialist Ross Delston say:

"For North Korea, cryptocurrencies provide an excellent opportunity to circumvent US sanctions. North Korea could create its own cryptocurrencies, or use those that already exist, for example, bitcoins. They can open anonymous accounts that allow them to hide their location."
The USA and its allies apply sanctions not only against North Korea. There are states such as Iran and Venezuela that have fallen out of favor with the USA and that, it seems, look at cryptocurrencies with great hope.

Just recently, the internet literally exploded with rumors that Russia may begin buying up bitcoins – also bypassing American sanctions. However, when The Daily Telegraph asked to comment on such forecasts, representatives of the Central Bank of Russia replied that such plans simply do not actually exist.

Type of cryptocurrency transactions No. 6: theft of cryptocurrencies

In addition to the aforementioned types of cryptocurrency transactions, we very often encounter banal thefts of digital currencies.

The company CipherTrace in its report for Q3 2018 also says that in the first half of 2018 a "threefold increase in the number of cryptocurrency thefts" was identified, while noting that "such a trend could exceed $1 billion by the end of 2018." Apparently, subsequent CipherTrace reports will clarify this figure.

In March 2018, the FBI reported that theft victims themselves contact the phone numbers of fictitious "cryptocurrency support services" (of which there are a great many on the internet), give them their wallet details and part with their cryptocurrencies forever.

Type of cryptocurrency transactions No. 7: hacking the cryptocurrency infrastructure

Why steal cryptocurrencies if you can "stamp out" as many as you need? This is exactly what a group of criminals did at the beginning of 2019, targeting the weaknesses of the cryptocurrency Ethereum Classic (ETC).

Security engineer at Coinbase Mark Nesbitt says:

"We observed deep structural changes in the Ethereum Classic blockchain, behind which, for the most part, were double-spend processes. We tracked double-spend processes amounting to 219,500 ETC (approximately $1.1 million)."
Double spending means that you take the same unit of cryptocurrency and spend it twice (it seems this is very similar to making dollars using a color copy machine).

Conclusions

Ah, you thought, what happened to cryptocurrency transaction type No. 8?

These are legal transactions in which real goods and services can be exchanged for cryptocurrency, – just as we do it using fiat money.

After all, many of us believe that buying coffee using cryptocurrencies in local cafes or sending them to friends in Venezuela so that they can buy food there is a great way to use digital currencies, which should change the future of money.

Yes, that would be great! However, one analyst from the American "Foundation for Defense of Democracies" said the following:

"Cryptocurrencies will most likely gain greater popularity among cybercriminals. Police and intelligence units dealing with cybercrime must deepen their knowledge in the field of cryptocurrencies and blockchain technology."