The blockchain data platform Chainalysis published the first results of its annual Crypto Crime Report. According to this, frauds increased significantly compared to the previous year. A relatively new type of fraud is also on the rise.
1) First results of Chainalysis "Crypto Crime Report" have been published
2) In 2021, scams increased by 81 percent
3) Law enforcement and security companies are getting better
Cryptocurrencies are very attractive to many people. But as popular as they may appear, the crypto currencies are also unregulated and highly speculative. In the course of the soaring of cryptocurrencies, there are also fraudsters among the reputable providers of trading platforms, some of whom cause high damage. High returns, passive income and financial freedom are promised through crypto trading, mining or investments. The blockchain data platform Chainalysis publishes the so-called Crypto Crime Report every year. The company announced the first results in advance in a blog post.
More and more fraudsters are using so-called "rug pulls" as a method
Chainalysis said scams were the largest form of crypto-crime in 2021. Measured by the transaction volume, victims were stolen over seven billion US dollars worldwide - an increase of 81 percent compared to the previous year. In 2020, the crime rate actually decreased compared to 2019. Chainalysis sees the reason for this considerable increase in so-called Ponzi systems. Similar to a pyramid scheme, the Ponzi scheme is, a fraud method that works on the basis of a lack of transparency. Providers attract with high returns, which are confirmed every year on counterfeit papers. In truth, however, the fraudsters are putting the money in their own pockets or investing it on the mainstream stock exchanges for the purpose of money laundering. While there were few such large-scale systems in circulation in 2020, according to Chainalysis, the online broker Finiko defrauded mainly Russian-speaking users across Eastern Europe by more than a billion US dollars in 2021.
A relatively new type of fraud also increased criminal activity in the crypto space in 2021 - so-called "rug pulls". These mainly take place in the Decentralized Finance (DeFi) area. Fraudsters collect money from injured parties using tokens and then stop reporting.
Law enforcement agencies are getting faster
The consumer advice center also warns of fraudsters and describes six signs on its website by which one can recognize dubious cryptocurrency providers. On the one hand, exaggerated promises, a seat abroad and active calls to attract new interested parties. On the other hand, a missing imprint, a lack of transparency and unsolicited contact.
