In what’s described as a rapidly evolving landscape of financial and economic crimes threatening the internal security of the European Union, Europol has applauded the independence and protection offered by blockchain technology.

Europol has also raised concerns over the rising criminal activity within decentralized finance (DeFi).

Europol Warns of Rising Criminal Activity in DeFi and NFT Space

Europol, the European Union Agency for Law Enforcement Cooperation, recently published its European Financial and Economic Crime Threat Assessment. 

This report highlights the complexities of financial and economic crimes that impact the EU, such as money laundering, corruption, fraud, intellectual property crime, and counterfeit currency. It emphasizes the importance of collaboration, information sharing, and public-private partnerships to combat these criminal activities effectively.

The fintech revolution, characterized by integrating technology into financial services, presents opportunities and risks. Criminals have quickly abused these innovations, particularly within digital banking and non-bank financial institutions. 

Decentralized finance (DeFi), based on blockchain technology, promises greater independence and security. However, the lack of regulation in this space leaves room for economic crimes, as criminals store illegal assets on DeFi platforms.

Highly volatile cryptocurrencies are also targeted in fraudulent schemes and money laundering.

Non-fungible tokens (NFTs) have surged in popularity but also attracted fraudsters due to their instant trading capabilities. NFTs pose a significant risk of money laundering, given their cross-border trading features.

Europol Urges Collaboration to Counter Financial Crimes in the EU

Moreover, the emergence of the metaverse, a digital space for various activities, has been adopted by the financial sector and presents new opportunities for criminals. Cases of fraud and theft withi