Copy link
Increase text size
Decrease text size
Link copied

Crypto-related crime fell to 0.34% of trading volume in 2020 from 2% in 2019

Losses from crypto fraud, theft, and hacks fell to $1.9 billion in 2020 compared to the $4.5 billion in losses posted in 2019.

Image by Pete Linforth from Pixabay

Fri, 29 Jan 2021, 07:12 am UTC

2020 has been a banner year for the crypto market. Despite initially faltering in March with the coronavirus pandemic-induced crash, it recovered and even rallied to new heights with various cryptocurrencies such as Bitcoin smashing their previous records.

But despite the rising crypto prices making them more attractive to cybercriminals, cryptocurrency-related crime surprisingly declined last year. According to CNBC, illicit activities made up only 34 percent of total crypto transaction volume in 2020, a huge decline from the 2 percent of transaction volume in 2019.

“We saw a significant decrease in the share of overall activity associated with illicit entities,” Chainalysis head of research Kim Grauer said. “Still, ransomware was by far the biggest category in terms of activity growth and we’re seeing an all-time high for dark-net market activity.”

Actual losses from cryptocurrency-related crime also fell by 57 percent last year, according to Reuters. Losses from crypto fraud, theft, and hacks fell to $1.9 billion in 2020 compared to the $4.5 billion in losses posted in 2019.

Crypto intelligence company CipherTrace said that the decrease is due to improved security systems in cryptocurrency firms. “Thefts from hacks against centralized exchanges continue to decrease as these financial institutions mature and adopt stronger security measures,” CipherTrace CEO Dave Jevans said in an interview.

Improved crypto industry regulation is also a factor in its reduction. “Regulation and enforcement are restricting centralized fraud schemes, which are pushing criminals to exploit decentralized finance services,” Jevans added.

Just like Chainalysis’s report, CipherTrace also noted an increase in criminal activity in the decentralized finance (DeFi) sector. In fact, $129 million in losses came from hacks tied to decentralized finance.

One factor for the increasing losses in the decentralized finance segment is due to inadequate regulation. “DeFi platforms enjoy many exemptions from traditional regulatory enforcement regimes that centralized exchanges, money service businesses, and banks face,” Jevans added.

“For example, DeFi platforms often do not have to perform customer verification (Know Your Customer) or transaction anti-money laundering,” he explained. “This makes them ideal venues for moving and laundering money.”

TokenPost | [email protected]

<Copyright © TokenPost. All Rights Reserved. >

To leave a comment, please sign in.
More
  • Bitcoin (btc) $51,555.00 (+2.94%)
  • Ethereum (eth) $1,782.14 (+7.46%)
  • Tether (usdt) $0.999906 (-0.34%)
  • Binance Coin (bnb) $235.15 (+0.32%)
  • Cardano (ada) $1.11 (-0.71%)
  • Bitcoin (btc) $51,555.00 (+2.94%)
Mar 8, 2021 (Monday)
14:36
BTC Drops by 1.13% Within 5 Mins, Marking 50,320.36 USDT
13:24
BTC Surges by 1.0% Within 5 Mins, Marking 50,888.3 USDT
10:19
Geth v1.10.1 Released
10:17
ICON (ICX) Unaffected By South Korean Tax Investigation Into ICONLOOP, Says Chairman
10:15
ETC Group To Launch Ethereum ETP On Deutsche Borse
10:00
BTC Tops List Of Crypto Net Outflow With $470.34 Mln In Past 18 Hours
09:49
Central Bank Of France Eyes XRP As Basis For Digital Euro
09:39
Art & entertainment NFT creation and trading platform Curio tweeted to reveal that all 250 editions of the Technical Boy NFT have been sold out in 5 minutes.
09:26
Decentralized lending platform Ruler Protocol announced to support flash loan.
08:52
Argo Blockchain Completes Texas Land Purchase To Build Bitcoin Mining Facility
08:50
Atari To Launch Crypto Casino In Ethereum-Based Virtual World
08:20
Peter Brandt Believes There’s 50% Chance Bitcoin Will Go To $1 Million
07:36
NFT Global Reveals That Soribada’s Corporate Crisis Has Nothing To Do With SOBA Project
07:27
OKEx Lists Velo's Native Asset, VELO, For Spot Trading
07:04
Norway's Aker ASA Sets Up Bitcoin Unit
06:21
The Number Of BTC Held On Exchanges Crashed 20% In 12 Months
06:20
If Ripple Goes Away, XRP Will Keep Trading: CEO Brad Garlinghouse
06:19
Chainlink announced that decentralized finance protocol Set Protocl has integrated with DPL/USD price feed.
06:16
PolkaFoundry To Postpone IDO Plan
06:12
UFC Announces Regional Partnerships With Top Crypto-Only Sportsbook
Subscribe to the TokenPost newsletter!
Don't show me this again today.
Back to top
Copyright ⓒ TokenPost. All Rights Reserved.
PUBLISHsoft