With a 38% drop in crypto crime, the market is poised to grow

Illicit transactions accounted for just 0.34% of total transaction volume in 2023, down from 0.42% the previous year

Blockchain analytics firm Chainalysis has released the introductory chapter of the 2024 Crypto Crime Report, which states that the value received in cryptocurrencies from illicit addresses over the past year totaled $24.2 billion, a significant drop of 38%. % of a total of $24.2 billion. historic record of $39.6 billion recorded in 2022. Of this total, approximately $14.9 billion (61.5%) is related to illicit transactions by sanctioned entities.

Illicit activities accounted for just 0.34% of total blockchain transaction volume last year, which Chainalysis says indicates the industry’s maturity.

“With Bitcoin crossing the $46,000 mark due to the SEC’s recent decision to approve BTC spot ETFs, there are strong signs that the cryptocurrency winter is thawing. Along with the significant reduction in criminal activity in the last year, it seems like a new phase of growth could be coming soon,” said Eric Jardine, Cybercrime Research Lead at Chainalysis.

The notable decline in illicit transaction volume is largely attributed to sharp declines in fraud and stolen cryptocurrency funds, for which total revenue fell by 29.2% and 54.3%, respectively.

Interestingly, the decline in stolen funds has been driven by a retreat in DeFi hacking, which is one of the most promising areas of the cryptocurrency ecosystem, largely due to its transparency. This drop could represent a reversal of trends that Chainalysis has been observing since 2022 and could be a sign that DeFi protocols are improving their security practices.

Rise of ransomware and darknets

On the other hand, the ransomware and darknet markets – two of the most prominent types of crypto crime – saw revenue increases in 2023, bucking general trends.

“Ransomware revenue growth is disappointing after the sharp decline seen last year and suggests that perhaps attackers have adapted to organizations’ cybersecurity improvements,” Jardine said.

“It also appears that Hydra’s shutdown has done little to deter darknet markets, as illicit activity on these channels is rebounding, with total revenues reaching all-time highs for 2021,” he said.

Another factor noted by Chainalysis is the continued shift of Bitcoin as the cryptocurrency of choice for cybercriminals. While some forms of illicit activity (such as darknet marketplace sales and ransomware extortion) still occur predominantly in Bitcoin, others (such as fraud and transactions associated with sanctioned entities) have moved to stablecoins.

Overall, Bitcoin was used in just under 25% of all illicit transactions, far behind stablecoins, which now account for the majority of activity, in line with the overall growth of stablecoins.

“This move by Bitcoin is an interesting development and once again demonstrates the maturity of the industry. Based on the SEC’s recent ruling on Bitcoin ETFs, as 2024 unfolds, I believe we will see a push for a more mature market infrastructure that will encourage a healthier and more competitive custody and trading ecosystem in key markets,” concluded Garden .

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Source: Terra

Rose

Rose James is a Gossipify movie and series reviewer known for her in-depth analysis and unique perspective on the latest releases. With a background in film studies, she provides engaging and informative reviews, and keeps readers up to date with industry trends and emerging talents.