Crypto scam revenue dips while hacks and stolen funds increase

An interim report from Chainalysis shows that cryptocurrency scams are down, while hacks and stolen funds are up.

Chainalysis, one of the leading analytics firms in the crypto space, Interim reportThe interim report highlights some of the trends within the crypto space from January to June 2022.

According to Chainalysis, 15% of illicit transaction volumes were recorded in the first half of this year, down from 36% recorded during the same period last year. The team said:

Overall, criminal activity appears more resilient in the face of falling prices. Fraudulent transaction volumes are down just 15% year-on-year compared to 36% of legitimate volumes. Aggregate data alone doesn’t tell the whole story, however: when we dig into specific forms of cryptocurrency-based crime, we find that some actually increased in 2022, while others declined more than the market as a whole. increase.”

Fraud revenue in the first half of the year was down 65% compared to the same period last year. Total fraud revenue for 2022 now stands at $1.6 billion, Chainalysis added.

The analytics firm suggested that the drop in fraud revenue could be related to falling prices, as bitcoin and other cryptocurrencies have fallen more than 50% since the beginning of the year.

Chainalysis added that the number of remittances to scams so far this year is also the lowest in four years. The company said that inexperienced users are less prevalent in the market now that most coins are dropping in price, which could reduce the revenue of the scam.

Despite the decline in fraud, Chainalysis noted an increase in hacks and stolen funds in the crypto space since the beginning of the year.

By July 2022, hacking services had stolen $1.9 billion worth of cryptocurrency, compared to just under $1.2 billion at the same point in 2021.

The $190 million hack of cross-chain bridge Nomad and the $5 million hack of multiple Solana wallets that already occurred in the first week of August have seen many more hacks and stolen funds this year. Indicates that it may occur.

Chainalysis wrote:

Furthermore, we should not assume that theft will decline based on cryptocurrency market movements like fraud. As long as crypto assets held in DeFi protocol pools and other services are valuable and vulnerable, malicious Someone tries to steal them, and the only way to stop them is for the industry to increase security and educate consumers on how to find safe projects to invest in. Meanwhile, law enforcement , must continue to develop the ability to seize stolen cryptocurrencies until they are no longer worth hacking.