Copy link
Increase text size
Decrease text size
Link copied

Insider frauds contributed the most to $4.5B crypto-crime losses in 2019: CipherTrace

Wed, 12 Feb 2020, 06:35 am UTC

Crypto analytics firm CipherTrace has estimated that crypto users, exchanges and investors suffered $4.5 billion in crypto-related losses resulting from thefts, hacks, and fraud, in a new report.

The company has released its Q4 2019 Cryptocurrency Anti-Money Laundering Report. It said that the total cryptocurrency crime increased by 160 percent in 2019 from 2018.

The report said that of the total amount that was lost, the lion’s share stemmed from the staggering growth of Ponzi schemes, exit scams, and misappropriation of funds crimes, the value of which rose 533 percent year over year to $4.1 billion. Cryptocurrency-related thefts and hacks saw a drop year over year to $370.7 million.

Banks harboring a lot more virtual assets than expected

Another notable discovery by CipherTrace is that traditional financial services have become increasingly infused with crypto assets. It found almost all U.S. banks harboring illicit virtual asset related money service businesses (MSBs), including crypto exchanges.

To put things in perspective, the report states that the typical top 10 U.S. banks unknowingly facilitate approximately $2 billion in illicit cryptocurrency transactions each year. The study also revealed that banks paid record AML fines globally in 2019—more than $6.2 billion. CipherTrace expects this number to increase in 2020 as crypto-related money laundering and sanction evasion enforcement ramps up.

“As crypto-assets become increasingly entangled in traditional financial services, AML and CTF compliance risks are on the rise,” said Stephen Ryan, COO of CipherTrace. “Virtual assets are now pervasive in bank accounts and payment networks, and banks must find ways to deal with the risks. Effectively mitigating cryptocurrency risks requires equipping compliance officers with the best tools and intelligence to gain visibility into this new asset class.”

Darknet Markets

The report said that 66 percent of dark market vendors sell stolen financial products and compromised accounts for cryptocurrency. Of this, 40 percent were found to be hawking compromised bank account or credit card credentials for as little as 1 percent of face value, 24 percent offered compromised payment services accounts, and the remaining 2 percent sold stolen cryptocurrency private keys.

The research also showed that bitcoin is the payment of choice for cyber extortionists. In fact, virtually all (97 percent) of ransomware attacks use bitcoin as the payment rail.

Expectations for 2020

CipherTrace believes that 2020 will be a year of “intense regulatory changes.” It has identified varying levels of maturity and sophistication in AML/CTF regimes around the globe. This includes the implementation of AMLD5 across the European Union in early January, which regulated crypto-fiat exchanges for the first time in most EU countries.

The company also described urgency among its customers and industry players around pending FATF Travel Rule legislation.

“Exchanges and financial institutions in the G20 have less than six months to find a solution for dealing with this major compliance conundrum—how to comply with the requirement to share sender and receiver information before executing cryptocurrency transactions, while protecting confidentiality,” it said.

TokenPost | [email protected]

<Copyright © TokenPost. All Rights Reserved. >

To leave a comment, please sign in.
  • Saff
  • 2020.02.14 01:08:32
Last year December I was contacted by a broker who convinced me to invest into Cryptoallday. I made an initial investment of € 190,00 and they asked for € 14,500 more in order to access my withdrawal. I followed their instructions and made another deposit. For 2 months now I have been trying to contact Cryptoallday but I got no response. I talked to my friends and colleagues about it and luckily for me a friend of mine just got out of a situation like that and introduced to a wealth recovery team that helped her during her investment problem, within 3 days of contacting them they were able to help me get 100% of my lost money back. They only got paid after the recovery and I had no problem with giving them 10% from the recovered funds after I got it back. You can reach out to them for more insight.
Bitcoinretrieval2018 gmail com
  • 1
  • ·
  • 0
  • Rachel
  • 2020.02.12 13:08:31
All these binary options, cryptocurrency and online investment companies are scams, i lost a total of $196k usd. Things have turned good for me, being able to recover my investments by a Recovery Pro. You can mail me if you are interested in the means I used to get my money back. Rachelmillr4 {at} gmail dot com
  • 0
  • ·
  • 0
  • Bitcoin (BTC) $9,809.91 (-1.71%)
  • Ethereum (ETH) $251.73 (-7.10%)
  • XRP (XRP) $0.224600 (+0.84%)
  • Bitcoin Cash (BCH) $391.69 (-12.65%)
  • Bitcoin SV (BSV) $271.77 (-13.91%)
  • Bitcoin (BTC) $9,809.91 (-1.71%)
Feb 17, 2020 (Monday)
Chinese forex regulator SAFE’s blockchain cross-border financing pilot continues expansion
Blockchain social media platform Steemit to migrate to TRON network
Feb 14, 2020 (Friday)
Crypto Technicals: Major Cryptocurrency Support Resistance Levels
Crypto Technicals: Major Cryptocurrency Daily Technical Outlook
Israel’s stock exchange partners with Edinburgh-based startup for its Blockchain Securities Lending platform
Blockchain insurance startup B3i completes 30 reinsurance contracts on its platform
Crypto Technicals: TRON (TRX) confirms 'Golden Cross' on the daily charts, eyes 61.8% Fib at 0.0297
Crypto investment firm Galaxy Digital lays off 15% of its workforce
Circle now seeks to sell off crowdfunding unit SeedInvest: Report
SBI Crypto enters into blockchain cooperation partnership with Northern Data
Wells Fargo invests $5M in crypto monitoring firm Elliptic
Crypto Technicals: XRP/USD pauses at 0.34 handle, consolidation likely before next leg higher
Election Commission of India looks to blockchain to tackle lost votes
Crypto Technicals: 'Spinning Top' dents upside in ETH/USD, technical bias remains bullish
Crypto lending startup BlockFi secures $30M in Series B financing
Crypto Technicals: BTC/USD holds above 10,000 mark, trades rangebound at 5-DMA support
IOTA Foundation investigates fund theft in Trinity wallet
Feb 13, 2020 (Thursday)
Crypto Technicals: Major Cryptocurrency Support Resistance Levels
Crypto Technicals: Major Cryptocurrency Daily Technical Outlook
U.S. Treasury Department’s FinCEN working on new crypto regulations
Subscribe to the TokenPost newsletter!
Don't show me this again today.
Back to top
Copyright ⓒ TokenPost. All Rights Reserved.