Crypto Crime Drops in 2023 to $24.2 Billion: Chainalysis
A new Chainalysis report on cryptocurrency crime trends shows an overall reduction in illicit crypto activity in 2023, though some forms of crypto-based crime are on the rise.
The 2024 Crypto Crime Trends report from blockchain analysis company Chainalysis estimates that the total value received by illicit cryptocurrency addresses dropped to $24.2 billion in 2023. In addition, that represents just 0.34% of all cryptocurrency transaction volume over the past year.
Key findings from the Chainalysis report:
- Crypto scam revenue fell 29.2% in 2023 as scammers shifted tactics towards more personalized “romance scams.”
- Funds stolen via crypto hacking dropped 54.3%, thanks largely to fewer successful hacks of decentralized finance (DeFi) protocols.
- Ransomware revenue increased in 2023 after declining in the prior year.
- Darknet market revenue also rebounded close to 2021 peak levels following the 2022 shutdown of Hydra, once the largest darknet market.
- Transactions with sanctioned entities accounted for 61.5% of all illicit crypto volume in 2023.
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The report notes that figures for illicit transaction volume are lower-bound estimates based on known illicit addresses. More addresses are often identified over time.
For example, the 2023 report estimates $39.6 billion worth of illicit crypto transaction volume occurred in 2022 due to identifying additional illicit addresses since last year’s report.
Concerns Remain Over Evolving Crypto Crime Trends
The Chainalysis data shows an overall reduction in cryptocurrency-based crime. However, the report points to continuing shifts in the preferred currencies and tactics used by cybercriminals and scammers that warrant ongoing vigilance by law enforcement and the crypto industry.
Crypto crime trends are evolving to avoid detection through personalized romance scams and the use of sanctioned jurisdictions to hide illicit activity in legitimate transactions. Additionally, ransomware threats remain resilient.
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As such, the report urges continued investment in emerging blockchain analytic capabilities to uncover illicit cryptographic activity across an array of cryptocurrencies and transaction types.
