The number of crypto scams this year is declining, despite billions being stolen through hacks.
A new report from blockchain intelligence firm Chainalysis shows that illicit activity involving cryptocurrency is down 15% this year. Compared to this, legitimate transactions have declined by 36%.
According to the firm, some forms of cryptocurrency-based crime have actually increased in 2022, while others have declined more than market overall.
The overall crypto market has declined 65% since the end of July 2021, which contributes to the decline in scam revenue in 2022.
Scam revenues have decreased around the same pace as Bitcoin prices since January 2022, the firm reports. According to the Federal Reserve, “In the past four years, the number of individual transfers to scams has been at its lowest point.”
As values drop in the bear market, Chainalysis says, fewer people are falling for cryptocurrency scams.
A related reason is that no significant scams have occurred in 2022, so far, compared to previous years in which scammers made off with over $2 billion from PlusToken or $1.5 billion from Finiko.
According to Chainalysis, while scams may be down, hacks still stole $1.9 billion in cryptocurrency in July 2022.
In comparison with last year, about $1.2 billion was stolen from Solana wallets during the same period due to a $190 million hack of the Nomad Token Bridge.
A cryptocurrency market movement won’t reduce theft, as scamming does, according to the firm.
It is inevitable that bad actors will try to steal crypto assets held in DeFi protocol pools and other services as long as they are valuable and vulnerable.”
With its software tools for detecting and preventing crypto-related crime, Chainalysis was founded in 2014.
