Europol: AI and crypto enhance criminal activity efficiency

Europol's report emphasizes how the use of AI-powered automation and crypto tools is escalating scams, phishing attacks, human trafficking, and other financial crimes throughout Europe.

Europol, the EU's law enforcement agency, released a report discussing the role of artificial intelligence (AI) and cryptocurrency in organized crime.

The agency's threat assessment report emphasized how criminal groups have swiftly adapted to new technologies, particularly AI and crypto. AI's capabilities make it a powerful tool for criminals, lowering entry barriers for digital crimes.

With AI, criminals can now generate targeted messages in multiple languages, expanding their reach globally. The technology has also been used to create malware and exploitative content, including child sexual abuse material.

Europol also noted that AI's automation features have greatly enhanced the efficiency of criminal activities. The agency highlighted how criminals are using AI to automate phishing campaigns, allowing them to target a larger number of victims through extensive cyberattacks.

The report further explained that AI-generated synthetic media enables criminals to deceive victims by impersonating individuals and engaging in blackmail. Europol added:

“The integration of AI-driven voice cloning and real-time video deepfakes intensifies the threat, facilitating new types of fraud, extortion, and identity theft.”

On February 13, blockchain analytics firm Chainalysis reported that generative AI is "amplifying scams," making them more affordable and scalable. Elad Fouk, head of fraud products at Chainalysis, stated that AI enables the creation of fake identities, allowing fraudsters to impersonate legitimate users.

In addition to AI, Europol's report highlighted how blockchain-based technologies such as cryptocurrency and non-fungible tokens (NFTs) have expanded beyond cybercrime into other areas of traditional crime. This includes activities like drug trafficking and migrant smuggling. Europol also pointed out the rise in criminal schemes aimed at stealing crypto, NFTs, and resources used for cryptocurrency mining.

Crypto investigator ZachXBT has expressed concern over the recent Bybit hack, which resulted in nearly $1.5 billion in losses. In a Telegram post, he stated that the hack has been a wake-up call, revealing how deeply the industry is compromised with hacks and exploits. ZachXBT remarked that the crypto sector may struggle to fix itself unless the government enforces regulations that could harm the entire industry.

As he worked to freeze funds tied to the hack, ZachXBT observed flaws in both decentralized and centralized protocols. He noted that some "decentralized" platforms recently saw nearly all their monthly volume and fees come from the Democratic People's Republic of Korea (DPRK) and refused to take responsibility. Additionally, he criticized how centralized exchanges handle illicit funds, pointing out that it takes them several hours to respond, whereas it only takes minutes to launder money.