More Cyber Criminals adopt Crypto, as Theft Rises by 516% in 2021 – Report

Cryptocurrency-based crime hit an all-time high in 2021, according to data available with blockchain research platform Chainalysys.

Crypto theft surged in 2021, with about $3.2bn worth of digital currency stolen last year, a 516% increase over 2020.

As much as $14bn (€12.4bn) was routed to illicit addresses over the course of the past year, up from $7.8bn in 2020, per data made public on 6 January.

Illicit addresses now hold around $10bn worth of digital currency, with the vast majority of this held by wallets associated with cryptocurrency theft. Addresses associated with darknet markets and with scams also contributed significantly to the abovementioned figure.

But, “much of this value comes not from the initial amount derived from criminal activity, but from subsequent price increases of the crypto assets held,” the authors noted.

According to the report, the growth of legitimate cryptocurrency usage is outpacing its criminal usage, with transactions involving illicit addresses, representing only 0.15 per cent of cryptocurrency transaction volume in 2021.

However, the company added that the total amount of illicit crypto activity in 2021 was worth $14bn.

It said, “However, we also have to balance the positives of the growth of legal cryptocurrency usage with the understanding that $14bn worth of illicit activity represents a significant problem.

“Criminal abuse of cryptocurrency creates huge impediments for continued adoption, heightens the likelihood of restrictions being imposed by governments, and worst of all victimises innocent people around the world.

Moreover, transactions involving illicit addresses accounted for just 0.15% of cryptocurrency transaction volume last year, in spite of the sheer “value of illicit transaction volumes reaching its highest level ever,” they added.