Illicit crypto transactions exceeded $51 billion in 2024, considerably larger than earlier estimates as a result of underreporting, in response to blockchain analytics agency Chainalysis.
The findings, printed within the firm’s newest Crypto Crime Report, point out a surge in AI-driven fraud, stablecoin laundering, and complicated cybercrime networks.
Regardless of preliminary projections suggesting a decline in crypto-related crime, deeper evaluation revealed that criminals have tailored to regulatory scrutiny, shifting away from Bitcoin (BTC) in favor of stablecoins and privacy-focused belongings.
The report additionally highlighted a rising reliance on automated deception and DeFi platforms to obscure illicit transactions.
Criminals want stablecoins
As soon as the dominant forex in illicit transactions, Bitcoin now accounts for a shrinking share of crypto crime.
Chainalysis reported that stablecoins had been concerned in 63% of illicit crypto transactions final yr, marking the third consecutive yr they’ve surpassed Bitcoin on this function.
In contrast to Bitcoin, which has comparatively slower affirmation occasions and excessive volatility, stablecoins supply near-instant transactions with minimal worth fluctuations.
This has made them a most well-liked device for laundering giant sums by means of cross-chain bridges, mixers, and decentralized platforms, permitting criminals to quickly shift funds and evade detection.
Main stablecoin issuers, corresponding to Tether, have tried to crack down on illicit exercise by freezing wallets linked to cybercrime. Nonetheless, criminals have turned to options, together with privacy-focused cryptocurrencies like Monero, self-custodial wallets, and DeFi-based laundering schemes.
Cybercrime and market manipulation
The report additionally famous a 35% drop in ransomware funds year-over-year. Whereas this initially appeared to sign progress in combating cyber extortion, Chainalysis discovered that ransomware operators had as an alternative diversified their ways.
Following the takedown of the LockBit ransomware group, smaller cybercrime syndicates have stuffed the hole, and ransomware-as-a-service operations have turn into extra decentralized.
Cybercriminals have more and more targeted on information theft and extortion, focusing on high-value establishments with threats to leak delicate info fairly than solely demanding ransom funds.
Past direct monetary crimes, Chainalysis discovered that market manipulation schemes stay a major downside within the crypto area. DEXs have turn into hubs for wash buying and selling, the place fraudulent merchants artificially inflate buying and selling volumes to mislead buyers.
The report estimated that $2.57 billion in illicit buying and selling quantity in 2024 was linked to clean buying and selling and market manipulation. Fraudsters have used automated bots to create the phantasm of demand, driving up token costs earlier than executing basic “pump-and-dump” schemes that go away unsuspecting buyers with nugatory belongings.
In a single high-profile case, crypto agency CLS World pleaded responsible to clean buying and selling a token that the FBI secretly created as a part of a sting operation.
Arms Race
Chainalysis’ 135-page report additionally explored the broader traits in crypto crime, together with laundering-as-a-service platforms, the decline of darknet markets, and the rising function of AI in monetary fraud.
The research detailed how North Korean hackers stole a report $1.34 billion final yr, highlighting the persistent challenges going through regulators and regulation enforcement.
With stablecoins enjoying an growing function in cash laundering, regulatory scrutiny is anticipated to accentuate. In the meantime, using AI-powered fraud — together with deepfake scams and artificial id theft — is anticipated to broaden, making it much more troublesome to trace illicit monetary exercise.
As cybercriminals proceed to adapt to enforcement measures, specialists warn that the battle between regulators and illicit actors will solely escalate, shaping the way forward for monetary crime and digital asset oversight.
