LONDON (REUTERS) – Crime involving cryptocurrencies hit an all-time excessive of US$14 billion (S$18.9 billion) final yr, blockchain researcher Chainalysis mentioned final Thursday (Jan 6), a file that comes as regulators name for extra powers over the fast-growing sector.
Crypto obtained by digital pockets addresses linked to illicit exercise together with scams, darknet markets and ransomware jumped 80 per cent from a yr earlier, Chainalysis mentioned in a report.
The exercise represented simply 0.15 per cent of complete crypto transaction volumes, its lowest ever.
Total volumes soared to US$15.8 trillion in 2021, up over five-fold from a yr earlier, United States-based Chainalysis mentioned.
Digital property, from bitcoin to non-fungible tokens, exploded in recognition in 2021 amid an embrace from institutional traders and main firms.
Newcomers have been drawn to the promise of fast features touted by crypto backers, in addition to hopes that bitcoin provides a hedge towards hovering inflation. But cryptocurrencies are nonetheless topic to patchy regulation, leaving traders with little recourse towards crime.
Monetary watchdogs and policymakers from Washington to Frankfurt have fretted over the usage of crypto for cash laundering, with some urging lawmakers to grant them larger powers over the trade.
“Legal abuse of cryptocurrency creates enormous impediments for continued adoption, heightens the chance of restrictions being imposed by governments, and worst of all victimises harmless folks world wide,” Chainalysis mentioned.
Driving the rise in crime was an explosion of scams and theft at decentralised finance – DeFi – platforms, it mentioned.