Cryptocurrency-based crimes pegged at $14 billion in 2021: Report

moneycontrol.com:

Cryptocurrency-based crime hit a high in 2021, with transactions involving illicit addresses receiving $14 billion over the year, up from $7.8 billion in 2020, blockchain data firm Chainalysis said.

However, as a percentage of cryptocurrency transaction volumes, the share of fraudulent transactions shrank to a record low of 0.15 percent in 2021, the firm said in a blog on its website, previewing its 2022 Crypto Crime Report due out in February.

Across all cryptocurrencies tracked by Chainalysis, the total transaction volume grew to $15.8 trillion in 2021, a six-fold increase from 2020’s totals.

The yearly trends suggest that crime is becoming a smaller part of the cryptocurrency ecosystem – except for 2019, an outlier year largely due to the PlusToken Ponzi scheme. They also show that law enforcement’s ability to combat cryptocurrency-based crime is evolving.

“We’ve seen several examples of this throughout 2021, from the CFTC (Commodity Futures Trading Commission) filing charges against several investment scams to the Federal Bureau of Investigation’s takedown of the prolific REvil ransomware strain, to the US Treasury’s Office of Foreign Assets Control’s sanctioning of Suex and Chatex, two Russia-based cryptocurrency services heavily involved in money laundering,” Chainalysis said in the blog.

Two categories stood out in terms of growth in crypto crimes – stolen funds and scams. Decentralised finance (DeFi) was a major part of both, with DeFi transaction volumes growing 10-fold in 2021.

DeFi is a financial technology based on secure distributed ledgers similar to those used by cryptocurrencies. The system eliminates the control that banks and institutions have on money and financial products and services.

Scamming revenue rose