Role of crypto in “all forms of crime” increasing

The cryptocurrency sector is entering the dominant current, thanks not only to a pro-Crypto president. Donald Trump, who courted the sector for his support for his return to the White House, had a generally positive impact on the crypto, despite the less favorable optics of his same companies.

Gary Gensler’s departure from Securities and Exchange American Commission (SEC) and several pro-Crypto appointments to the Trump administration, including a Tsar Crypto, all had a positive influence on the sector.

Tokénisation and institutional adoption through the funds negotiated on the stock market (ETF) also contribute to the growth in the adoption of cryptography.

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Unfortunately, this also meant that criminals are increasingly targeting the crypto. A recent report By Chainalysis highlights the increase in the foray of illicit actors in the activity on the chain.

Some of these criminals, they wrote, conduct their offline illicit activities but turn to crypto for money laundering.

And they become more professional in what they are also doing, with “enlargement of the range of illegal actors and networks using cryptocurrency, as well as increased complexity in their operations”.

Crime product estimates are likely to be reassessed upwards

In pure dollar terms, the chain analyzes suggests that if the initial figures of 2024 show a drop in the value received by the illicit cryptocurrency addresses to 40.9 billion US dollars (65.7 billion dollars in), these are “lower connection estimates based on illicit addresses (…) identified until today”.

They provide that these figures will increase “as more illicit addresses are discovered” and that their historical activities are included in future reports.

Based on past trends and the average annual growth rate of 25% in their estimates of illicit activities since 2020, the channel analyzes that the total revised for 2024 can possibly exceed 51 billion US dollars (81.9 billion dollars in).

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The projection is based on the identification and continuous integration of new data, similar to the way in which last year’s figure for 2023 was initially declared to $ 24.2 billion US dollars ($ 38.9 billion in) but later revised at 46.1 billion US dollars ($ 74 billion in).

In total, this number still represents only 0.14% of the chain transaction volume. As the cryptography sector is developing, illegal activity, although the report indicates that this is generally well below the 1%bar.

According to analysts, the report does not yet include unidentified funds and also excludes “non-cripto-native crime”.

They also exclude extremist funding because it is difficult to define, as well as alleged market and market manipulation.

Ransomware, scams and stolen funds grouped despite the application efforts

Although the total value of illicit cryptography funds is lower than that of previous years, the Channel Analysis has always experienced an increase in crime, mainly in scams and stolen funds, the latter increasing by 21% in annual sliding to 2.2 billion US dollars ($ 3.5 billion in).

Part of the stolen crypto can be traced in North Korea, whose IT workers have “increasingly infiltrating crypto and web3 companies, compromising their networks and used tactics, techniques and sophisticated procedures (TTPS)”.

Artificial intelligence also becomes more and more concern, according to the report:

Although the police were able to disrupt ransomware operations, Chainalysis reports that the sector continues to obtain “in the hundreds of millions of dollars” in the product.

And while the entrances to the Darknet market and fraud workshops are decreasing, they still represent US dollars $ 2.2 billion.

Cryptographic crime becomes “professional” and “diverse”

Aside from the numbers, illicit actors are becoming more and more sophisticated and the landscape of cryptographic crime becomes “increasingly diverse”.

$ 10.8 billion US dollars (17.4 billion Australian dollars) of the total of US dollars ($ 65.7 billion in) received by illicit cryptographic addresses went to the entities involved in direct cybercrimes – such as hacking, extortion, traffic and scams – provide essential services and infrastructure for these activities, including washing-as-a-service.

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Huione’s guarantee on the online market is a particularly striking example of the professionalization of the cryptographic crime ecosystem, having treated more than $ 70 billion US dollars (112.5 billion dollars in) in cryptographic transactions since 2021.