Tighter regulations and higher penalties may deter some crypto crimes, the Chainalysis report states.
The blockchain forensics provider released on Wednesday the report “Crypto Crime Status” for 2020. It offers an analysis of last year’s illicit activities, contrasting with the actions of previous years.
Chainalysis found that although the amount of Bitcoin sent from criminal entities doubled between 2018 and the end of 2019, it still represents only 0.08 percent of the total number of Bitcoin transactions last year.
Despite the fact that there have been numerous hacks and thefts from exchanges, frauds lead to damages.
“The scams were by far the category of crypto crime that made the biggest gains in 2019”,
is shown in the report.
“Crypto-scams are a significant danger to consumer protection. The growth of this activity in 2019 requires increased actions from the regulatory authorities, law enforcement and exchange offices. ”
Blockchain provider proposes solutions
According to the report, crypto scams have accumulated about $ 4.3 billion in cryptocurrencies. Overall, Chainalysis estimates total illicit activity totaled $ 6 billion last year.
Overall, scams accounted for $ 8.6 billion in cryptocurrency transactions. Criminal activity (including thefts and hacks) totaled just under $ 12.5 billion.
Other categories of crime include terrorist financing, ransomware, darknet markets and direct theft.
Chainalysis notes that a better solution to reducing the problem of illicit activities with cryptocurrencies is better regulation. Clearer rules would lead to better enforcement of regulations and actions by crypto exchanges to combat illicit activities.
“We believe that the implications of consumer protection make crypto scams a topic that must be addressed by regulatory authorities. Law enforcement agencies must also have the resources to investigate. The exchanges are also uniquely positioned to help, both in terms of protecting scam users and preventing successful scammers from depositing or cashing in. “
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