Some forms of cryptocurrency-based crime, including hacking and theft of funds, have increased so far this year, but others, related to fraud and the darknet market, have fallen more than the overall market, according to the new. report by a blockchain analysis company Chainalysis.
In its mid-year crypto crime update, the company notes that 2022 has been a terrible year for the crypto industry, and, therefore, the volume of crypto transactions for illegal and legitimate entities is still behind 2021 until July.
“Overall, criminal activity appears to be more resistant in the face of price declines: Illicit volumes fall by only 15% per year, compared to 36% for legal volumes. However, aggregate data does not tell the whole story,” the report said.
After digging into certain forms of crime based on crypto, we observed that some have actually increased this year.
“No area of cryptocurrency-based crime is fighting the 2022 revenue decline trend like stolen funds,” Chainalysis said.
Through July 2022, it said, USD 1.9bn worth of cryptocurrencies had been stolen in service hacks, compared to just under USD 1.2bn at the same point in 2021. “This trend does not appear to be reversing,” the report added, with USD 190m-hack from the cross bridge Nomad and USD 5 million hack of Solana (SOL) The wallet happened in the first week of August alone.
The company’s experts argue that much of this can be attributed to the increase in stolen funds from decentralized finance (DeFi) protocol, a style that started last year.
At the same time, other types of crypto-based criminal activity have declined more than the overall market, the report said.
“Total scam revenue for 2022 is now at [USD] 1.6 billion, 65% lower than at the end of July in 2021, and this decrease appears to be related to the drop in prices in various currencies,” the company said.
It is worth noting that the revenue of the darknet market will also be lower in 2022, as it is currently 43% below the level until July 2021, says Chainalysis.