Privacy coins, mixers and Layer2 platforms may make it difficult for law enforcement agencies to track funds, according to a report from the EU's Internal Security Innovation Center. The report points out that the mixer Tornado Cash uses zero-knowledge proofs to enable users to withdraw funds from the mixer without revealing the original deposit, which greatly increases the difficulty for law enforcement agencies to track the source of (illegal) cryptocurrencies; privacy coins like Monero have privacy features built into their protocols, hiding the identities of senders, receivers and even transaction amounts; Layer2 solutions, such as the Lightning Network, may also be abused by criminals, for example, which can be used to pay each other without showing the time and amount of these payments; similarly, new wallet encryption schemes may also complicate law enforcement agencies' legal access. (CoinDesk)