In its cyber crime report, Europol said the use of encrypted tools, which enable offenders to stay anonymous, were now "becoming the norm".
With millions of children online, access to them was "higher than ever".
Cybercrime reporting in Europe had surpassed traditional crimes, it said.
Europol called the ability for child sex offenders to communicate, store and share materials and hunt for new victims online "one of the internet's most damaging and abhorrent aspects".
It said they were targeting social networks, online games and forums used mainly by children - and then encouraging a groomed child to continue communication on encrypted platforms that allow the sharing of chat, video and photos.
Live streaming is also "a growing threat", the report says, "facilitated by end-to-end encrypted platforms where not even the service providers can access what is being shared among their users".
"Traditionally the victims of live distant child abuse were based in South-East Asia, in particular the Philippines. More recent reports indicate that it is now spreading to other countries," the report says.
"Regions of the world with high levels of poverty, limited domestic child protection measures and easy access to children are being targeted by offenders..."
The report says that as well as educating children, parents and carers about staying safe on the internet, law enforcement must invest "human and IT resources to improve the opportunities for victims to be identified".