Chainalysis has released its mid-year crypto crime update and... it's good and bad.
The good? Aggregate illicit activity on-chain has fallen by almost 20% year to date, Chainalysis said.
The bad is really bad though. Stolen funds nearly doubled from US$857 million to US$1.58 billion. On average, the amount of cryptocurrency stolen per heist increased by almost 80%, due to Bitcoin going up in price abut also centralised exchanges being targeted.
Also, the Norkies (that's a technical term for North Korean IT workers) are busy social engineering to steal crypto.
Ransomware is also on the up, and 2024 has seen some large payments being collected. Chainalysis mentioned the Dark Angels criminals picking up US$75 million as an example, indicating ransomware is still a very lucrative business to be in, despite police efforts to quell the cybercriminal enterprise.
The median ransom demanded, meanwhile, rose to US$1.5 million in mid-June from US$200,000 in early 2023, and on-chain inflows hit US$459.8 million, up 2% from US$449.1 million.
Despite all that, Chainalysis reckons victims are paying ransom less often this year, so that's one bright spot.
13 Comments
I don't mind being wrong, but in this case I'm not, 80%+ of all craptocurrencies have already gone to zero or thereabouts, and this is trending up.
What's your source? As of March 2024, there are 13,217 cryptocurrencies in existence. However, only around 8,985 are still active, discounting many "dead" cryptos.
So this does not fit with your 80%.
https://explodingtopics.com/blog/number-of-cryptocurrencies
Important to note that the top 20 cryptocurrencies make up nearly 90% of the total market.
Will the appetite for digital theft, fraud and scams out live most people alive today? Of course it will. Is it likely to use a new version of older technology and even use old popular terms to do so, yes. There are a great many people who still get scammed with old popular investment options even though they are now largely unfavorable because the word, name, & marketing has history. It is not that this is a new thing. It is that the main vehicle of cryptocurrencies is for fraud and that there are far fewer customer recourse options when crime against them occurs or even just normal trade actions like refunds or return of funds in cases of errors with applications.
It is not a small thing to reduce what little customer protections there were to zero. Customer and legal protections have been fought for across generations. It normally takes more time to build them up again then the mere moments it takes to pretend they don't exist because functions are ported to new technology not clearly covered by laws or without easy means of enforcement. Try protecting your IP when it is stolen for NFT sales. Or an investment when the exchange company has a theft of their own funds. Or try getting returns for Bitcoin purchases (in which only if the trader is feeling exceptionally ethical they need to convert to another currency value and back again but in most cases they don't honor consumer trading laws). There is a very real issue when the tech is incapable of abiding by existing trading laws and yet followers purport it will be all things to everyone. It is very good for fraud if the scammers are capable of washing trades with numerous holding accounts which are trivial now to set up with automated bots.
In fact bot trading is so popular with cryptocurrencies there are no barriers to numerous bots you can use yourself to enable trading and washing of funds and bots trading with bots are the main level of transactions in the market. If you are manually making trades with bitcoin yourself you are doing it wrong and in the minority.
Free bots are easy to setup and configure, I would however recommend to you to learn some of the failures and foibles of bot trading via cryptocurrencies or investment first so you can understand better the settings and rules you should use. I myself have tested quite a few, found them easy enough for children to work with, and so long as your understanding of logic, rules and mathematics reaches high school level you should be ok... sadly many in NZ don't start from that basis. Bot trading can help reduce some risks, introduces others, but the biggest risk is the main methods of trading cryptocurrencies themselves. Avoid exchanges & storage via exchanges as much as possible. The size and popularity of an exchange or the locality of it is no protection. The largest exchanges used by NZders crashed, so to did many of the ones overseas. This happens so regularly that the exchanges themselves are also major vehicles of fraud, scams, and crime (even just more minor crimes like identity theft and sale of your private id info to others).
In fact bot trading is so popular with cryptocurrencies there are no barriers to numerous bots you can use yourself to enable trading and washing of funds and bots trading with bots are the main level of transactions in the market. If you are manually making trades with bitcoin yourself you are doing it wrong and in the minority.
I don't know where you got this information but if you can show me a bot that "washes funds", please do. Washing of funds has typically been done via cryptocurrency mixers, aka tumblers - services designed to enhance privacy in cryptocurrency transactions by obscuring the origin of funds. They achieve this by pooling together deposits from multiple users, mixing them, and then redistributing them to different addresses. This process makes it challenging to trace the original source of the funds, similar to traditional money laundering methods.
Yes but this is what largely moves the cryptocurrency market and increases the value. Hence cryptocurrency speculators are largely dependent on growing levels of crime to ensure the value of their investments and often start turning to endorsing the market and even some of the fraudulent schemes to help boost the likelihood of further victims to help their own position.
It is increasing level & number of transactions with fees clipped that help boost the value and to get that the main vehicle for cryptocurrency trading was scams, fraud, and crime. Sadly the technology is far too impractical, technically costly & energy wasteful to be used for more legitimate means in every day currency movements. It would take too long to process transactions at even a thousandth the speed of normal digital transactions for goods and services for a tenth of the transactions we make. No one would be willing to wait at a till for that long for a sale, but paying to reduce the inconvenience of the wait is seen as a blatant cash grab. Hence the extra charges of Paywave, to speed up till times by seconds, are hidden from most buyers & they are unaware of them from the outset in most cases, which is why it becomes more successful. Online & digital transactions often don't clearly show the additional fees alongside the costs of items until the final payment in a gotcha. Eftpos & debit transactions or those direct with banks are very fast, at high volume, and can be both physical or online, and result in fewer transaction fees.
Sadly cryptocurrency is the wrong application use case for blockchain technology. It is wasteful, slow, highly flawed and just more prone to customer harm (with fewer avenues for real recourse or refunds). If anything it is great for speculators so long as the levels of fraud and scams increase and riding that wave comes with caveats so that the investor does not get scammed or a target for theft themselves.
Hence cryptocurrency speculators are largely dependent on growing levels of crime to ensure the value of their investments
I would disagree with this. If it were true, that would assume a correlation between the aggregate price of cryptocurrencies and related crimes. There is no correlation.
Only 0.47% of the estimated $2.22 trillion to $5.54 trillion laundered annually is done through crypto. The vast majority occurs through traditional financial systems.
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