Crypto Crime Down by 65% So Far This Year-Chainalysis Report Reveals
According to a Chainalysis report, crypto inflows to illicit entities, excluding those that have been sanctioned or subject to special measures, have decreased by 65% compared to the same time in 2022.
By Anna B Kiwanuka
According to a report from blockchain data firm Chainalysis, the world of cryptocurrency has seen a significant decline in crypto-related crime in 2023 compared to the previous year. The data reveals that such criminal activities have dropped by a notable 65% so far this year. Chainalysis based its findings on the analysis of digital asset inflows to illicit entities. These entities primarily include addresses associated with darknet markets or ransomware attackers.
In addition to the decline in illicit activities, the report also highlights a 42% decrease in inflows to “risky entities,” which encompasses high-risk exchanges and mixers frequently used by criminals to launder funds. The overall reduction in crypto crime is occurring despite a market pullback, with illicit crypto transaction volume falling more significantly than legitimate crypto transaction volume.
Chainalysis emphasizes that scams, which have historically been the most profitable form of cryptocurrency-based crime, have experienced a substantial decline in revenue. Compared to the same period in 2022, total scam revenue has plummeted by 77%. This decline is particularly noteworthy because digital asset prices have risen during this time, typically favoring criminal groups. Bitcoin, for example, has more than doubled in value from less than $17,000 per coin in January to its current price of $30,500.
The report stated, “Usually, positive price movements translate to higher scam revenue, likely because increased market exuberance and FOMO make victims more susceptible to scammers’ pitches. But 2023’s drastic scam decline bucks that long-standing trend.”
But despite the fall in scams, ransomware attacks are growing: attackers are on pace for their second-biggest year ever and have extorted at least $449 million through June.