Cryptocurrency has always been linked to crime by governments and people who don’t want it. Many people think that all criminals use crypto, but it is still a lot less than the amount of criminal activity that happens with fiat currencies. Sources say that only 1% of cryptocurrencies are used by criminals. However, this does not mean that criminals aren’t using cryptocurrency, and recent reports show that they are making a lot of money with it.
In 2021, more criminals is using crypto.
It’s been five years since a report from Chainalysis said that the balances of people who do bad things with crypto have been going up slowly but steadily. But in 2021, their balances grew as the market grew, and they were able to buy more. Crime was on the rise because more people were investing in the market. This went from small scams to full-scale hacks and attacks on major crypto exchanges. This is how it started.
There were a lot of big changes in the balances of these criminals this year. They had $11 billion in cryptocurrencies at the end of 2021, and this money came from wallet addresses that have been linked to crimes.
Cybercriminals had almost doubled their cryptocurrency balances in the last year. At the end of 2020, they had just $3 billion, but by the end of 2021, they had more than $11 billion.
More than 90% of all criminal balances came from stolen money, which made up the bulk of these funds, These stolen funds made up a total of $9.8 of the total amount. Most of the money came from darknet market funds, which made up $448 million of the total. The rest came from scams, fraud shops, and ransomware.
As the year went on, the report says that criminal balances also “fluctuated.” They went from a low of $6.6 billion in July to $14.8 billion in October. When these funds are tracked on the blockchain or seized by law enforcement, some of them can be sold.
Criminals are clamped down on by the law.
Law enforcement has been working more to catch people who use cryptography to do bad things. Using a digital asset that lets you move money without telling anyone is becoming more popular with criminals, so law enforcement has had to step up their game to keep up with them. This has worked out in big ways.
A lot of cryptocurrency was seized by the IRS-CI in 2021 alone. These ransomware attacks also spread to the US Department of Justice, which had been able to get back a lot of money in crypto used in ransomware attacks.
Bitfinex’s hackers stole $3.6 billion worth of bitcoin. The DOJ was able to get that money back from them. They had moved 10,000 BTC from their wallets. It is still the largest amount of money that has been reclaimed in cryptocurrency or fiat money.
Disclaimer: These are the writer’s opinions and should not be considered investment advice. Readers should do their own research.