Surpass $189 Billion Over the Last Five Years!
2024 has turned out to be a year of one of the biggest inflows into illicit activities with the help of cryptocurrencies. According to Chainanalysis, one of the leading cryptocurrency analytics companies, the total amount funneled into illicit addresses has reached $51.3 billion, bringing the five-year total to an astonishing $189 billion.
While their report is impressive, Chainanalysis estimates that to date, only $40.9 billion has been tracked to known unlawful addresses figure that shows how far there is to go in identifying all illegal transactions.
Of the amount confirmed, $10.8 billion went directly to wallets involved in cybercrime activities: hacking, extortion, fraud, and selling the tools and infrastructure that power such activities.
The Rise of Illicit Transactions in the Crypto World
Chainanalysis found that over the years, there had been greater adoption, and notably, a wider accolade of cryptocurrencies. Illegal activities across blockchains used to be highly concentrated in cybercrime earlier; today, cryptocurrencies also serve to further and facilitate everything from national security threats to consumer protection.
The growing adoption of blockchains has seen illegal activities across them diversify. Some illegal entities operate entirely off-chain, transferring only the funds onto it for laundering.
The percentage of total blockchain activity taken by illicit transactions has plummeted to 0.14% from 0.61% in 2023, the company said, adding that as usual, this number might increase in value as previous illicit transaction values are recalculated, and could stand a little below the more than 1% the category has repeatedly held in the previous year.
Key Trends in Crypto Crime Sanctioned entities, including persons in the sanctioned regions, often have greater incentives to use stablecoins as a result of challenges accessing U.S. dollars through traditional means and harnessing the stability of the dollar.
The total funds stolen increased 21% from the prior year to 2.2 billion dollars. Though DeFi services accounted for the highest share of stolen funds, centralized services suffered the most in the second and third quarters of the year.
North Korean hackers dominated, siphoning off $1.34 billion, which is 61% of the total funds stolen this year. Some of the attacks seem to have been performed by North Korean IT workers who compromised several cryptocurrency companies and Web3 networks using various sophisticated techniques.
The Evolution of Fraud and Scams
In 2024, there was a significant increase in high- and low-tech fraud. The most successful types included high-return investment scams and “pig butchering” scams. The trend of artificial intelligence in fraud befits broader trends in cybercrime, as AI-powered services have also started being used to circumvent Know Your Customer (KYC) laws.
Cryptocurrency-related ATM scams also continued to target the elderly specifically.
Ransomware and Dark Web
While ransomware is still a hugely lucrative business, hundreds of millions of dollars in revenue have been eroded through multi-agency law enforcement interventions and a reduction in the number of victims who reported the incident and paid ransoms.
Regardless, 2024 was another high-activity year, with ransomware attacks continuing to happen at unparalleled rates, and a few ransomware groups securing payments, though smaller in value.
Future Projections
Revenues of the dark web have shrunk to $2 billion from an estimated $2.3 billion in 2023, while revenues at scam sites more than halved to $220.1 million. In part, this is a result of a joint operation by the United States and the Netherlands against the anonymous payment system “UAPS,” which supported hundreds of scam websites.
As the operational ecosystem of cryptocurrencies evolves, so do methodologies in crime committed with them. The future promises to be varied in crypto-crime types, increasingly combined with heavier use of such sophisticated technologies as AI to make their frauds and hacking activities more efficient.
