(Reuters) – Crime involving cryptocurrencies reached a record high of $ 14 billion last year, blockchain researcher Chainalysis said on Thursday, a record that comes when regulators demand more power over the fast-growing sector.
Crypto gained. of digital wallet addresses linked to illegal activity including fraud, darkroom markets and ransomware increased 80% from a year earlier, Chainalysis said in a report. The activity represented only 0.15% of the total cryptotransaction volume, the lowest ever.
Total volumes soared to $ 15.8 trillion in 2021, more than five times from the previous year, said US-based Chainalysis. Digital assets, from bitcoin to non-fungal tokens, exploded in popularity in 2021
Newcomers have been drawn to the promise of quick profits sold by crypto supporters, as well as hopes that bitcoin offers protection against sky-high inflation. Nevertheless, cryptocurrencies are still subject to uneven regulation, which means that investors can not turn against crime.
Financial watchdogs and decision-makers from Washington to Frankfurt have been concerned about the use of cryptocurrencies for money laundering, and some are urging lawmakers to give them greater powers over industry.
introduced by governments and worst of all expose innocent people around the world, "said Chainalysis. was an explosion of fraud and theft on decentralized financial platforms – DeFi – platforms, it said.
DeFi sites – which offer loans, insurance and other financial services while bypassing traditional gatekeepers such as banks – have been plagued by problems that include shortcomings in the underlying code and opaque governance.
The total theft of cryptocurrency grew more than fivefold from 2020, with a coin worth around $ 3.2 billion stolen last year. About $ 2.2 billion of these funds, about 72% of the total, were stolen from DeFi websites.
Fraud on DeFi platforms – like "rug pulls", where developers created fake investment opportunities before disappearing with investors' money – hit $ 7.8 billion, an increase of 82% from 2021, said Chainalysis.