CRYPTOASSETS, MONEY LAUNDERING AND CRIMINAL LIABILITY: ECONOMIC AND LEGAL CHALLENGES OF THE DIGITAL FINANCIAL SYSTEM
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Abstract
The present article provides a comprehensive economic and legal analysis of the use of cryptoassets in mechanisms for the legalisation (laundering) of proceeds of crime. In addition, it examines the specific features of criminal-law responses to such practices within the digital financial system. The study's relevance is determined by the rapid expansion of the global cryptoasset market, the growth in the volume of illicit cryptocurrency transactions, and the increasing use of stablecoins, P2P and OTC channels, cryptocurrency mixers, and other technologies in schemes designed to transfer and conceal criminal proceeds. It is also determined by the need to adapt national financial monitoring and criminal justice systems to the technological transformation of financial relations. The purpose of the study is fourfold: to identify the economic mechanisms through which cryptoassets are used for money laundering; to assess the applicability of Article 209 of the Criminal Code of Ukraine to digital forms of economic value; to pinpoint the primary challenges of criminal law qualification and evidentiary assessment; and to provide recommendations for enhancing the national economic and legal mechanisms for combating illicit financial flows in the digital environment. The study establishes that, while cryptoassets do not alter the economic essence of money laundering, they do significantly transform the architecture of the financial trail. This is achieved by increasing transactional complexity, fragmenting financial flows, enabling the repeated conversion of digital value and combining decentralised and traditional financial infrastructures. It is argued that the current wording of Article 209 of the Criminal Code of Ukraine is sufficiently technology-neutral to encompass transactions involving cryptoassets. However, the main challenges lie in establishing the link between a digital asset and a predicate criminal offence, identifying the beneficial or actual controller of the asset, proving that the individual is aware of its criminal origin, and ensuring effective procedural control over virtual assets. The study also shows that the FATF's standards and the European Union's regulatory framework provide the conceptual basis for integrating crypto assets into the wider system of risk-based AML/CFT regulation. The study's scientific novelty lies in substantiating an integrated model of economic and legal counteraction to money laundering involving cryptoassets. This model incorporates technology-neutral criminal law, specialised criminal procedural mechanisms for dealing with digital assets, risk-based financial monitoring, blockchain analytics and international co-operation. The findings have the potential to improve law enforcement practice under Article 209 of the Criminal Code of Ukraine by developing procedures for the detection, seizure, custody, valuation and confiscation of cryptoassets. They could also strengthen the analytical capacity of financial intelligence and criminal justice authorities and harmonise national regulation with FATF standards and European Union law.
How to Cite
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cryptoassets, money laundering, criminal liability, digital financial system, financial monitoring, blockchain analytics, FATF, MiCA
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