Global Illicit Activity in Crypto Falls 20% Year to Date: Chain Analysis

On August 15, crypto compliance and research firm Chainalysis released the first part of its 2024 Crypto Crime Report.

The company revealed that aggregate illicit activity on the chain has fallen by 19.6% year-to-date, from $20.9 billion to $16.7 billion.

He added that this shows “that legitimate activity is growing faster than illicit activity.”

Part 1 of our half year #cryptocrime the update is here! Illicit activity on the chain was down nearly 20% year over year, but stolen funds activity is increasing and ransomware payouts are breaking records. Read our blog for a detailed analysis. https://t.co/WRGG91mpFP

— Chainalysis (@chainalysis) August 15, 2024

Not all good news

However, it also reported that despite this decline in illicit transactions, two categories of illicit activity – stolen funds and ransomware – are on the rise.

“While illicit activity is down year-to-date (YTD) compared to previous years, crypto inflows to specific cybercrime-related entities show some worrying trends.”

Stolen funds nearly doubled from $857 million to $1.58 billion, while ransomware inflows increased by about 2%, from $449.1 million to $459.8 million. he reported before adding that the amount is already 84% higher than the value stolen in the first half of 2023.

The research revealed that the average amount stolen per heist increased by almost 80%, and hackers are targeting centralized exchanges more often instead of prioritizing DeFi protocols.

“After a 50% reduction in stolen crypto value in 2023 compared to 2022, this year has seen a resurgence in hacking activity.”

Also, this year is on track to be the highest-grossing year for ransomware payments. The average ransom payment for severe malware strains has increased from $200,000 in early 2023 to $1.5 million in mid-June 2024.

However, despite more frequent attacks, victims pay ransoms less frequently.

Chainalysis also reported that entries to “risky services” such as mixers and exchanges without KYC procedures are trending higher than at this time last year.

Beating the criminals

The researchers concluded that the key to disrupting cybercrime is to “disrupt its supply chains, including attackers, affiliates, partners, infrastructure service providers, money launderers, and collection points.

On August 15, Chainalysts published the results of a survey revealing that there was a resounding call for more staff resources for cryptographic research.

He noted that the shortage of experts to help with cryptographic investigations is a critical problem.

“The survey results highlight a critical need for more staff, specialized expertise and better technical resources.”

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