ABSTRACT
Cryptocurrencies have been increasingly involved in financial crimes. This chapter aims to classify the roles of cryptocurrencies in financial crimes, and the applicable laws, accordingly. The chapter also tries to identify possible flaws in the existing legal system. The chapter begins by elaborating the definition and development of cryptocurrency around the globe and pinpointing the features of cryptocurrency that are used by financial criminals. The chapter discusses further the direct and indirect involvements of cryptocurrency in financial crimes and the core and applicable laws and acts. Through carefully analysing relevant primary and secondary legislation of the UK, this chapter identifies some potential issues in the legal system: micropayment, individual activities and jurisdictions, where the unharmonised jurisdiction scheme has caused delays in some prosecution proceedings. The chapter concludes that cryptocurrency has been a convenient tool for those committing financial crimes. Despite the effort of Financial Action Taskforce, the legal system hasn’t yet caught up with technology development. The chapter provides the first review and classification of the laws and acts applied to the cryptocurrency crimes in the UK. It also calls for an internationally harmonised legal system. The discovered flaws may urge authorities to improve the existing regulatory frameworks and legal provisions.
