Cryptocrime hits a record $20 billion in 2022

By Elizabeth Howcroft

The illegal use of cryptocurrencies hit a record $20.1 billion last year, when prices skyrocketed transactions with Business under U.S. sanctions, data from the security analytics firm showed on Thursday “blockchain” Chainalysis.

The cryptocurrency market faltered in 2022 as risk appetite waned and several crypto companies went under. Investors suffered heavy losses and regulators intensified their calls for greater consumer protection.

Although the total volume of cryptocurrency transactions fell, the value of cryptocurrency transactions related to illicit activities increased for the second year in a row, according to Chainalysis.

Transactions associated with sanctioned entities increased more than 100,000 times in 2022 and accounted for 44% of illicit activity last year, Chainalysis said.

The funds received by the Russian market Garantex, sanctioned by the United States Department of the Treasury in April, represented “much of the illicit volume of 2022″said Chainalysis. A Chainalysis spokesperson said that the wallets are labeled as “illegal” if they are part of a sanctioned entity.

Garantex did not immediately respond to an emailed request for comment.

The United States also imposed sanctions last year on cryptocurrency mixing services Blender and Tornado Cash, which it said were being used by hackers, including from North Korea, to launder billions of dollars from their cybercrime.

The volume of stolen crypto funds increased 7% last year, but that of other illicit crypto transactions, such as those related to scams, ransomware, terrorist financing and human trafficking, decreased.

Chainalysis said its estimate of $20.1 billion only includes activity recorded in “blockchain” and excludes crimes “off the chain”such as fraudulent accounting by crypto companies.

The figure also excludes when cryptocurrencies are the proceeds of non-cryptocurrency crimes, such as when cryptocurrency is used as a means of payment in drug trafficking, Chainalysis said.

(With information from Reuters)