Crypto Crimes Drop 65%, but Ransomware Attacks Soar, Chainalysis Report Finds

According to a recent crypto crime report by blockchain data company Chainalysis, cryptocurrency-related crimes have decreased by 65% ​​in the first half of 2023 compared to the same period in 2022. This decline was mainly due to a significant decrease in crypto fraud and illicit fraud . web market activity.

The report reveals that crypto criminals have generated around $3.3 billion less in revenue by 2023, totaling just over $1.0 billion for the year. In June 2022 alone, crypto fraudsters generated 77% more revenue than in June 2023.

Interestingly, the decline in crypto crime has occurred despite positive price movements in cryptocurrencies. Typically, price increases result in higher fraud income, because market enthusiasm and fear of missing out (FOMO) make individuals more vulnerable to fraud. However, the decline in fraud this year broke that trend.

Chainalysis also highlighted a 42% drop in inflows to “risky entities” such as high-risk exchanges and mixers, which are commonly exploited by crypto hackers for money laundering purposes.

The report attributes the decline in revenue earned by crypto criminals to the absence of two major types of investment scams, VidiLook and Chia Tai Tianqing Pharmaceutical Financial Management, both of which appear to have perpetrated exit scams.

However, the report highlights a concerning trend: ransomware attacks are surging in the crypto market. While other types of crypto crime have decreased, ransomware attacks have resulted in at least $449 million in losses as of June 2023.

The decline in ransomware attacks in 2022, which was linked to the Russia-Ukraine war, is considered a contributing factor to the overall decline in crypto crime. The displacement of organizations involved in such attacks due to the war played a role in this decline.

The report estimates that if the current level of ransomware attacks continues, these attackers could steal around $898.6 million by the end of this year. The spike in ransomware attacks has been driven in large part by the practice of “big-hunting”, which targets entities with large financial resources.

While overall crypto crime has decreased significantly, the rise in ransomware attacks underscores the constant challenges in the crypto market. Continuous efforts are needed to mitigate the risks associated with these attacks and ensure the security of the crypto ecosystem.