Cryptocurrency Ransomware Attacks Surged Over 300% in 2020: Chainalysis’ Crime Report
Revenue from crypto-related crime was reduced by 53% last year. Illicit funds, scams, and proceeds of crime through crypto also dropped. However, The value of ransomware attacks tripled, generating over $350 million.
Chainalysis’ “Crypto Crime Report 2021” shows a significant decrease in cryptocurrency-related crime across 2020, revenue from these illicit activities dropping by $5 billion, or 53%, from the previous year. The total illicit activity compared to the total transactional volume also dipped to only 0.34% in 2020, or $10 billion – a sharp dip from the 2.1% ($21.4 billion) recorded in 2019.
Overall, cryptocurrency-related scams and illegal activities are falling. Only a small portion of illicit activity is left in the crypto ecosystem. The overall illicit value from crypto is falling compared to illicit funds in traditional finance, the Chainalysis report reads.
As was the case in 2019, scams made up the biggest chunk of crypto-related crime – reporting $2.7 billion, a sharp 71% drop from $9 billion the previous year. Interestingly, the number of individual scams made to scam wallets rose by 48% across 2020 to 7.3 million individual scams. The sharp drop in value in 2020 mainly arises from the fact that no scam is close enough to the magnanimous PlusToken Ponzi scam in 2019.
Across 2020, the total crime value from scams and other illicit acts raised nearly $10 billion, dropping from $20 billion in revenue collected by bad actors in 2019.
Despite the celebrations, the value from ransomware attacks tripled in the past year, representing 7% of all the illicit crypto-based transactions. At $350 million in value across 2020, crypto-ransomware attacks grew over 311% in a year – the largest growth amongst the report's illicit categories. The spike is attributed to the global Covid-19 pandemic, which prompted the “work from home” culture, presenting new vulnerable opportunities.
Darknet markets and stolen funds witness a less dramatic increase than ransomware – a 29% increase and a 4% increase from 2019’s values, respectively.
Earlier in the year, Chainalysis reported that the total number of cryptocurrency crimes had fallen over 83% in 2020, as regulation and exchange compliance came alive during the year.