Late last month, Brazil’s Federal Police launched Operation Lusocoin, a sweeping investigation into a sophisticated criminal network accused of laundering billions of reais through cryptocurrency. The operation — coordinated by the Superintendence of the Federal Police in Rio Grande do Sul — executed 13 search and seizure warrants, 11 temporary arrests, and issued court-ordered freezes on assets totaling more than 3 billion Brazilian reais (≈ USD 540 million).

According to investigators, the network operated as an international money-laundering and foreign-exchange evasion scheme, converting illicit profits from drug trafficking, smuggling, tax evasion, and even terrorism financing into crypto assets to obscure the source of…