WASABI WALLET – AN EMERGING THREAT
Given that the main purpose of Wasabi is to protect the anonymity of its users with several built-in privacy
features, it is no surprise that the wallet is a favorite among privacy-seekers and money launderers.
In April 2020, Europol’s EC3 European Cybercrime Centre issued a detailed report on Wasabi and its adoption
by criminals, which was publicly leaked. The report notes that almost 30% of money flowing into Wasabi comes
from darknet marketplaces and states that “things are not looking good” for law enforcement due to the
enhanced anonymity of criminals using Wasabi. Finally, the report establishes that "suspects who avoid major
slip ups will have a very high probability of staying undetected."
Later that year, in their Internet Organised Crime Threat Assessment (IOCTA) 2020 report, Europol also named
privacy-enhanced wallet services using CoinJoin as a “top threat in addition to well established centralized
mixers.”
The increasing number of investigations involving Wasabi Wallets captured the attention of several other
agencies and outlets. In May 2020, Bitfury's Crypto analytics team found that 20% of darknet entity proceeds
were sent to mixers such as Coinjoin in 2020, compared to 1% in 2019.
Later, in July 2020, funds illegally obtained through a high-publicity Twitter hack were sent to Wasabi Wallets.
Another suspected example of the illicit use of Wasabi relates to the notorious PlusToken, a popular high-
yield investment pyramid scheme operating largely in Asia. The Ponzi scheme operated from April 2018 until
June 2019, when law enforcement arrested 6 in conjunction with the scam, which affected 3 million users
and an estimated $2.9 billion in investments. An analysis of attempted Bitcoin mixing by an entity with links to
PlusToken spotted an attempt to mix more than 50,000 bitcoins. The Wasabi Wallet mixer processed some of
these bitcoins before they were merged and sent to exchanges.
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