Chainalysis Reports: Crypto Crime Surpasses $24B in 2023

• Cryptocurrency Transactions Associated with Illicit Addresses Decreased in 2023
• Identifying Illicit Activities
• Shift in Illicit Activity
• Stablecoins Dominate Illicit Transaction Volume
• Trends in Crypto Crime

Cryptocurrency Transactions Associated with Illicit Addresses Decreased in 2023

Blockchain intelligence firm Chainalysis estimated that illicit addresses received over $24 billion worth of cryptocurrency in 2023. This represents 0.34% of all transaction volume, a figure that marks a near 40% decrease from the previous year. However, these figures are provisional and may increase over time as more addresses are labeled as illicit.

Identifying Illicit Activities

In 2022, the total illicit transaction volume stood at $39.6 billion. By the time of Chainalysis' report that year, only $20.6 billion worth had been identified. The complexity of these cases increases with the involvement of sanctioned entities. Sanctioned entities were involved in transactions worth a cumulative $14.9 billion in 2023, accounting for 61.5% of the volume. This figure includes transactions from ordinary cryptocurrency holders living in sanctioned jurisdictions, highlighting the intricate nature of tracking illegitimate activities in the digital currency realm.

Shift in Illicit Activity

In the past, Russia-based crypto exchange Garantex received sanctions from U.S. and U.K. bodies. However, it is crucial to note that not all users of this platform were engaged in money laundering and ransomware activities. The Chainalysis report underscores an evolving and nuanced landscape of illicit cryptocurrency use. These findings highlight the moving target that regulatory and law enforcement bodies face in the sector.

Stablecoins Dominate Illicit Transaction Volume

In 2023, like in the previous year, stablecoins were the most used in illicit transactions. Prior to 2022, bitcoin was the criminal's cryptocurrency of choice, taking the majority of transaction volume each year from 2018-2021. However, this trend saw a significant shift in 2022 when stablecoins accounted for about two-thirds of the volume, a pattern that persisted into 2023.

Trends in Crypto Crime

Last year, the number of crypto scams and hacks fell by 29.2% and 54.3% respectively, according to Chainalysis. On the other hand, ransomware and dark net activities were on the rise.

Edited by Jonathan Stoker