Virtual assets as a tool for legalization of property obtained through criminal means: a comparative legal aspect

Abstract

The article deals with separate issues of legal evaluation and ways to counter dangerous practices of using virtual currencies in the course of legalizing property obtained through criminal means. The research analysis is based on the principle of interdisciplinary research with an active appeal to international and separately foreign experience of combating the legalization of criminal income through the use of transactions with cryptocurrencies.
 The position is argued, referring to specific examples of large-scale “financial-virtual” abuses, that Ukraine also needs to develop its own clear action plan regarding the legal regulation of the circulation of virtual assets, in particular by implementing effective national mechanisms to prevent (or at least reduce) money laundering practices of money obtained by criminal methods, taking into account the immediate threats to the financial system of Ukraine from the actions of a country that carries out armed aggression against our state.
 It was stated that although legal scholars traditionally have different approaches to the interpretation of the phenomenon of legalization of criminal income, there is still no complete understanding and definition of it, since money laundering can be considered as a multi-level phenomenon (as a crime, action, process, technology, stage, method and procedure, type of business activity, etc.), in scientific and practical circles, a common, established approach is to distinguish three main stages in the laundering of criminal proceeds: location, concealment and integration. It is shown that these stages cannot be equally applied to legalization schemes implemented using fiat or virtual currencies.
 In the final part of the article, the authors emphasized that the improvement of the domestic model of combating practices of legalization of money obtained by criminal methods should be implemented primarily by improving the regulatory framework and the system of organizational and legal measures to combat such practices by national regulators and individual departments of law enforcement agencies; at the same time, the criminal law component in the process of introducing proposed changes should have a conditionally secondary, auxiliary value.