As much as cryptocurrency has made the world smaller and has unlocked a whole new sector of the financial industry, there is still concern about the possible use of cryptocurrency for illicit activities. This includes its use on the dark web for illegal goods and services, the use of cryptocurrency for money laundering and also the use of cryptocurrency to sponsor terrorist activities. A number of steps have been taken to track down, prevent and prosecute these sorts of activities and even as cryptocurrency regulation is being developed around the world, the prevention of the misuse of crypto is at the top of the agenda. 

Recently, it was announced that the Ukrainian government will reserve the right to track the source of funds in cryptocurrency wallets and if necessary, block the wallets themselves.

Ukraine Takes a Stand 

According to Oksana Markarova, Ukraine’s Finance Minister, the State Financial Monitoring Service of Ukraine (SFMS) will be responsible for tracking the origin of funds found on citizens’ crypto wallet and this is in an effort to prevent illicit activities.

In a January 23, 2020 interview, Makarova stated that the agency will not only track the origin of funds but also how those funds have been spent and that they have access to tools that will enable them to do so.

He stated that while it is impossible to block a crypto transaction, it is possible to block the wallets through the use of private keys.

“It is impossible to stop operations now, but it is possible to block crypto wallets and remove illegally obtained crypto assets. This can be done by gaining access to the crypto’s private keys as a result of complex investigations,” he said. 

This new development is part of new responsibilities granted to the agency through a crypto-related law that was passed in late 2019. The new law also stipulates that any crypto transactions above the value of $1,300 must be accompanied by know-your-customer requirements and the relationship between the payer and the payee must also be made known.

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