An Anatomy of Crypto-Enabled Cybercrimes

30 Pages Posted: 18 Aug 2022 Last revised: 11 Sep 2022

See all articles by Lin William Cong

Lin William Cong

Cornell University - Samuel Curtis Johnson Graduate School of Management; National Bureau of Economic Research (NBER)

Campbell R. Harvey

Duke University - Fuqua School of Business; National Bureau of Economic Research (NBER)

Daniel Rabetti

Tel Aviv University - Coller School of Management

Zong-Yu Wu

affiliation not provided to SSRN

Date Written: July 30, 2022

Abstract

While the advent of cryptocurrencies and digital assets holds promise for improving and disrupting financial systems by offering cheap, quick, and secure transfer of value, it also opens up new payment channels for cybercrimes. A prerequisite to solving a problem is understanding the nature of the problem. Assembling a diverse set of public, proprietary, and hand-collected data, including dark web conversations in Russian, we conduct the first detailed anatomy of crypto-enabled cybercrimes and highlight relevant economic issues. Our analyses reveal that a few organized ransomware gangs dominate the space and have evolved into sophisticated corporate-like operations with physical offices, franchising, and affiliation programs. Their techniques have also become more aggressive over time, entailing multiple layers of extortion and reputation management. Blanket restrictions on cryptocurrency usage may prove ineffective in tackling crypto-enabled cybercrime and hinder innovations. Instead, blockchain transparency and digital footprints enable effective forensics for tracking, monitoring, and shutting down dominant cybercriminal organizations.

Keywords: Blockchain Forensics, Digital Footprints, Cryptocurrency, Cybercrime, Ransomware

JEL Classification: F24, F52, G15, G18, G23, G38, K42

Suggested Citation

Cong, Lin and Harvey, Campbell R. and Rabetti, Daniel and Wu, Zong-Yu, An Anatomy of Crypto-Enabled Cybercrimes (July 30, 2022). Available at SSRN: https://ssrn.com/abstract=4188661 or http://dx.doi.org/10.2139/ssrn.4188661

Lin Cong

Cornell University - Samuel Curtis Johnson Graduate School of Management ( email )

Ithaca, NY 14853
United States

HOME PAGE: http://www.linwilliamcong.com/

National Bureau of Economic Research (NBER) ( email )

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

Campbell R. Harvey

Duke University - Fuqua School of Business ( email )

Box 90120
Durham, NC 27708-0120
United States
919-660-7768 (Phone)

HOME PAGE: http://www.duke.edu/~charvey

National Bureau of Economic Research (NBER)

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

Daniel Rabetti (Contact Author)

Tel Aviv University - Coller School of Management ( email )

Ramat Aviv
Tel-Aviv, 6997801
Israel
972-54-9107234 (Phone)

HOME PAGE: http://https://en-coller.tau.ac.il/

Zong-Yu Wu

affiliation not provided to SSRN

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