Crypto money laundering conceals illegally obtained funds by funneling them through cryptocurrency transactions, complicating tracking efforts by authorities. Criminals gather funds from illicit activities and convert them into cryptocurrencies via non-compliant exchanges, often using mixers and decentralized exchanges (DEXs) to obscure their origins. The laundering process includes hiding ownership through multiple transactions and reintegrating 'cleaned' money into the economy through various legitimate channels. Techniques include using online gambling sites and over-the-counter brokers. In 2023, $22.2 billion was linked to illicit activities within the crypto ecosystem. Regulatory efforts are increasing globally, with nations like the US, Canada, and members of the EU implementing stricter laws to combat these activities. The Financial Action Task Force (FATF) also plays a role in establishing cooperative frameworks. To prevent crypto money laundering, stringent Know Your Customer (KYC) and Anti-Money Laundering (AML) protocols are essential, alongside enhanced cooperation between service platforms and law enforcement.

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