FBI’s New ‘Crypto Unit’ Arrives Amid Growing Cyber Crimes

Key Insights:

• FBI has set up a new ‘Virtual Assets Unit’ to curb online criminal activities like ransomware attacks and Ponzi schemes.
• The unit will help with intelligence, technology, and operational support.
• The team will allow the FBI to “aggressively track” illicit funds and attribute criminal actors.

The Federal Bureau of Investigation (FBI) announced on Tuesday, the creation of a new ‘crypto unit’ to crack down on cyberattacks.

Dubbed Virtual Assets Unit (VAU), the team will be a ‘nerve center’ for the FBI’s crypto programs, providing intelligence, technology, and operational support.

“The VAU will allow the FBI to continue to aggressively track the movement of illicit funds, attribute criminal actors, and disrupt illegal activity.”

FBI release said that the unit would house experts from the crypto industry and cross-divisional resources to help seamlessly integrate intelligence and operations.

The VAU, first proposed by the Justice Department in February, joins other cryptocurrency efforts, including a National Cryptocurrency Enforcement Team (NCET) within the Criminal Division.

The NCET division has been “investigating and prosecuting crimes involving digital currencies,” director Eun Young Choi said at the time.

Surging Crypto Cyber Crimes

The arrival of VAU coincides with the rise in cryptocurrency-related online crimes, likely due to the increasing popularity of digital currencies such as Bitcoin and Ether and their corresponding price increase.

According to a recent study by Chainalysis entitled ‘Crypto Crime Trends for 2022’, criminals made $14 billion from crypto-related crimes in 2021, up from $7.8 billion in 2020.

The Justice department executed the largest cryptocurrency seizure in history after impounding Bitcoin worth $3.6 billion as a part of the 2016 Bitfinex exchange theft valued at $4.5 billion at the time of the attack.

The FBI and Cybersecurity and Infrastructure Security Agency (CISA) issued an alert last year, warning businesses about the increasing ransomware attacks. The caution follows the infamous Colonial Pipeline ransomware hack that took down the largest fuel pipeline in the US and led to shortages across the East Coast.

The Colonial Pipeline allegedly paid the ransomware group close to $5 million in crypto to decrypt locked systems.

In May 2021, US President Biden signed an executive order to boost the federal government’s cyber posture.

The order intended to curb cyber crypto crimes includes a shift to multi-factor authentication, data encryption, a zero-trust security model, and improvements in endpoint protection.

The US Is Moving in ‘Leaps and Bounds’ on Crypto

The launch of the new task force – VAU, marks a significant step in the country’s crusade against criminal abuse of cryptocurrencies. The unit will serve as a focal point for the Department of Justice’s efforts to tackle the increase in crime involving crypto technologies.

The move aligns with the United States’ efforts to address the misuse of cryptos in various aspects to clear the path for crypto regulation. 

The arrival of VAU comes days after President Joe Biden’s executive order aimed at framing and strengthening regulatory measures around cryptos. The order will involve the Treasury, State, and Commerce Departments.