Threat Actors Laundered $8.6 Billion in Cryptocurrency Last Year, Chainalysis Reports
Chainalysis, a firm specializing in analysis and investigation software for blockchains and decentralized finance (DeFi), has revealed shocking statistics regarding money laundering activities in the cryptocurrency space. According to their upcoming report, threat actors laundered a staggering $8.6 billion in cryptocurrency in 2021, marking a 30% increase from the previous year.
However, these numbers only account for funds derived from “cryptocurrency-native” crimes, such as cyber-criminal activities like darknet market sales and ransomware attacks. The actual figure could be much higher when considering “non-crypto” crimes that involve the conversion of fiat currency into cryptocurrency for laundering purposes.
Despite the perception of the cryptocurrency industry as a lawless environment, the transparent nature of blockchains makes it easier to monitor and track money laundering efforts involving cryptocurrencies. Last year, DeFi protocols received the majority of illicit funds, surpassing centralized exchanges for the first time since 2018.
In 2021, DeFi protocols received a total of $900 million from illicit addresses, representing a significant 1,964% year-on-year increase. Chainalysis also identified North Korean hackers as heavy users of DeFi, with an estimated $400 million stolen in cryptocurrency last year.
Although money laundering activities are concentrated on a small number of services, the analysis revealed that over half (55%) of all cryptocurrency sent from illicit addresses went to just 270 service deposit addresses. Among these addresses were those associated with exchanges like Suex and Chatex, which were sanctioned by the US Treasury last year.
Chainalysis emphasized the importance of law enforcement intervention in disrupting these services to combat cryptocurrency-based crime effectively. By targeting these key services, authorities can hinder criminals’ ability to access and utilize their illicit digital assets.
Overall, the findings from Chainalysis underscore the ongoing challenges and complexities in combating money laundering and illicit activities in the cryptocurrency space. As the industry continues to evolve, regulatory measures and enforcement actions will play a crucial role in ensuring the integrity and security of digital assets.