The decrease in crypto crime in 2023 is a positive sign for the industry and is supported by the latest Chainalysis report. According to the report, the amount of crypto stolen through scams last year decreased by nearly a third compared to 2022. In addition, illicit revenue in total was down more than 54%.
Stolen cryptocurrency accounted for 0.34% of total on-chain transactions in 2023, totaling $24.2 billion, compared to 0.42% or $39.6 billion in 2022. Notably, the 2022 amount was significantly higher due to including $8.7 billion in FTX creditor claims. Despite this, it’s important to note that criminal activity, including ransomware and darknet market activities, saw significant revenue increases compared to the previous year.
Chainalysis also highlighted a shift in the cryptocurrency used by cybercriminals, as stablecoins have now become the preferred choice over Bitcoin. The firm reported that stablecoins now account for the majority of all illicit transaction volume. However, stablecoin dominance isn’t the case for all forms of cryptocurrency-based crime.
Regarding regulatory efforts, Massachusetts Senator Elizabeth Warren, a longtime critic of cryptocurrency, has called for federal regulators to do more to crack down on illegal activity using digital currency. In a letter to the Blockchain Association, she expressed concern over the association and other crypto interests allegedly working to undermine bipartisan efforts to address the role of cryptocurrency in financing terrorism.
The decrease in crypto crime comes amid a concerning rise in money laundering using online casinos in East and Southeast Asia, as reported by the United Nations Office on Drugs and Crime (UNODC). Transnational organized crime in Southeast Asia has evolved rapidly with the embrace of technology, revolutionizing the crime environment in the region.
The latest findings indicate a shifting landscape for crypto crime, with both positive and concerning developments. It’s clear that the industry will continue to navigate regulatory challenges and the evolving tactics of cybercriminals, as well as adapt to new trends such as stablecoin dominance in illicit transactions.