Fri 28 January 2022:
According to a report released on Wednesday by blockchain analysis firm Chainalysis, cybercriminals laundered $8.6 billion in cryptocurrencies last year, a 30 percent increase from 2020.
According to Chainalysis, cybercriminals have laundered more than $33 billion in cryptocurrency since 2017, with the majority of the total moving to centralized exchanges over time.
Given the significant growth in both legitimate and illegal crypto activity last year, the firm believes the sharp increase in money laundering activity in 2021 is unsurprising.
Money laundering refers to that process of disguising the origin of illegally obtained money by transferring it to legitimate businesses.
About 17% of the $8.6 billion laundered went to decentralized finance applications, Chainalysis said, referring to the sector which facilitates crypto-denominated financial transactions outside of traditional banks.
That was up from 2% in 2020.
Mining pools, high-risk exchanges, and mixers also saw substantial increases in value received from illicit addresses, the report said. Mixers typically combine potentially identifiable or tainted cryptocurrency funds with others, so as to conceal the trail to the fund’s original source.
Wallet addresses associated with theft sent just under half of their stolen funds, or more than $750 million worth of crypto in total, to decentralized finance platforms, according to the Chainalysis report.
Chainalysis also clarified that the $8.6 billion laundered last year represents funds derived from crypto-native crime such as darknet market sales or ransomware attacks in which profits are in crypto instead of fiat currencies.
“It’s more difficult to measure how much fiat currency derived from off-line crime — traditional drug trafficking, for example — is converted into cryptocurrency to be laundered,” Chainalysis said in the report.
“However, we know anecdotally this is happening.”
Analysts expect a further rise in crypto crimes this year. According to Kim Grauer, Chainalysis’ director of research, 2022 “is already off to a big start for NFT (non-fungible tokens)” crimes.
“This is definitely going to continue.”
SOURCE: INDEPENDENT PRESS AND NEWS AGENCIES
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