According to a recent post by blockchain analytics firm Elliptic, cross-chain bridges – decentralized protocols that allow users to transfer assets between blockchains – have become a key facilitator of money laundering. Since 2020, one protocol, RenBridge, has reportedly facilitated the laundering of over $540 million in cryptoassets derived from theft, fraud, ransomware and other illicit endeavors. While much of the traffic on bridges is legitimate, according to Elliptic, the lack of regulation allows criminal activity to flourish. Without a central service provider to facilitate these cross-chain transactions, bridges are likely to continue to pose a challenge to regulators.
For more information, please refer to the following links:
- Cross-chain Crime: More Than Half a Billion Dollars has Been Laundered Through a Cross-chain Bridge
- Cross-chain bridge RenBridge laundered $540M in hacking proceeds: Elliptic
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