crypto fraud revenue 2022: Crypto fraud revenue falls 65% amid economic downturn
Since January 2022, fraud revenue has fallen more or less in line with Bitcoin prices, Blockchain analysis firm Chainalysis reports.
“It is not just fraud revenue that is falling – the cumulative number of individual transfers to fraud so far in 2022 is the lowest it has been in the past four years,” the report said.
These numbers suggest that fewer people than ever are falling for cryptocurrency scams.
One reason for this may be that with falling asset prices, cryptocurrency scams are less tempting for potential victims.
“New, inexperienced users who are more likely to fall for scams are less prevalent in the market now that prices are falling, as opposed to when prices are rising and they are drawn in by hype and the promise of quick returns,” the findings showed.
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The year has been turbulent for cryptocurrency markets, with significant price drops across all currencies in May and June.
Bitcoin currently hovers between $20,000 and $24,000 per digital coin.
“Overall, criminal activity appears to be more resilient in the face of price declines: Illicit volumes are down just 15% year-on-year, compared to 36% for legitimate volumes,” the report said.
The fraud revenue is often driven by large outliers, such as PlusToken, which yielded over $2 billion from victims in 2019, or Finiko, which yielded over $1.5 billion in 2021.
So far in 2022, no fraud identified so far has approached the level of either.
The biggest scam of 2022 so far has yielded $273 million in cryptocurrency, just 24% of Finiko’s earnings until the end of July 2021.
However, it is possible “an outlier could emerge or be identified before the end of the year and reverse the trend of declining fraud revenue that we are currently seeing”.
Darknet market revenue has also significantly decreased in 2022, and is currently 43% lower than where it was through July of 2021.
Hacking and stolen funds are still taking place in the north in 2022.
Through July 2022, $1.9 billion worth of cryptocurrency has been stolen in hacking services, compared to just under $1.2 billion at the same time in 2021.
This trend does not appear to be reversing anytime soon, with a $190 million hack of cross-chain bridge Nomad and a $5 million hack of several Solana wallets already occurring in the first week of August.
