Crypto crime drops: Chainalysis

However, an uplift is seen in ransomware and darknet markets.

Unlawful activity dropped in 2023 amongst the cryptocurrency crime scene however, activity in ransomware and darknet markets saw an uplift according to the latest findings from Chainalysis.

The blockchain analysis firm’s latest report 2024 Crypto Crime Report found “a significant drop in value received by illicit cryptocurrency addresses, to a total of $24.2 billion”, compared to 2022 which saw $39.6 billion.

Part of the reasoning behind the high 2022 figures was down to the inclusion of $8.7 billion in creditor claims against exchange FTX, following the conviction of founder Sam Bankman-Fried for fraud.

The report observed a decrease in crypto scamming and hacking by 29.2 percent and 54.3 percent respectively, but said ransomware and darknet markets experienced growth.

Chengyi Ong, head of APAC policy at Chainalysis told Digital Nation the “first line of defence comes from preventive efforts such as public education” when it comes to staying wise against crypto scams.

“But an enduring solution will require boosting law enforcement capacity to address cyber-enabled crime domestically and across borders, and disrupting the illicit financial infrastructure that underpins this activity,” Ong said.

She said Australian businesses have a role to play in identifying and flagging suspicious activity, “particularly relating to vulnerable clients; supporting victims; and working across industry and with law enforcement on information sharing and investigations.”

“But scams are not the only form of crypto-related crime that Australian businesses need to be aware of,” Ong said.

“Our data shows that sanctions-related transactions accounted for a combined $14.9 billion worth of transaction volume in 2023, which represents 61.5 percent of all illicit transaction volume we measured in the year.

“Australian businesses that deal with crypto can help protect themselves against illicit activity by adopting robust AML/CFT and sanctions compliance programmes, and drawing on analytical tools that leverage the transparency of the blockchain to flag suspicious transactions,” Ong concluded.