Ride the Lightning
Cybersecurity and Future of Law Practice Blog
by Sharon D. Nelson Esq., President of Sensei Enterprises, Inc.
U.S. Will Sanction Cryptocurrency Exchanges/Wallets Used in Ransomware Payments
September 21, 2021
On September 17, Bleeping Computer reported that the U.S. is expected next week to sanction crypto exchanges, wallets, and individuals who aid ransomware gangs in converting cryptocurrency.
As cryptocurrency is a required component of ransomware operations, the Biden administration hopes to disrupt this payment method and associated attacks with sanctions.
Almost all ransomware operations demand either Bitcoin or Monero for ransom payments. However, nearly all ransom payments are made in Bitcoin, as Monero is considered a privacy coin and not offered for sale by the vast majority of US crypto exchanges.
After payment is made, ransomware gangs ultimately have to cash out the crypto into fiat money, such as US dollars or local currency.
The cryptocurrency is first transferred through mixers to make the coins less traceable and then converted using crypto exchanges or their employees.
By sanctioning crypto exchanges used by ransomware actors, the government hopes to disrupt this economy and make it far harder for ransomware gangs to operate.
“An action of this kind would be an aggressive, proactive approach to going after those who facilitate ransomware payments,” Ari Redbord, a former senior Treasury security official, told the Wall Street Journal regarding the expected sanctions.
This would not be the first action taken against ransomware operators.
In 2019, the US charged members of the Evil Corp for stealing over $100 million and added members of the cybercrime group to the Office of Foreign Assets Control (OFAC) sanction list.
The US Treasury also warned that ransomware negotiators may face civil penalties for facilitating ransomware payments to ransomware gangs on the sanction list.
This action certainly won’t bring ransomware operations to a halt, but it might be a good step toward disrupting them.
Sharon D. Nelson, Esq., President, Sensei Enterprises, Inc.
3975 University Drive, Suite 225, Fairfax, VA 22030
Email: Phone: 703-359-0700
Digital Forensics/Cybersecurity/Information Technology