Key Points
- Illicit crypto transactions in 2024 are predicted to exceed 2023’s record, with a shift from Bitcoin to stablecoins for money laundering.
- Stablecoins now make up 63% of illegal transaction volume, while Bitcoin accounts for only 20%.
In 2024, the number of illegal cryptocurrency transactions is projected to exceed the previous year’s record. This is primarily due to criminals shifting from using Bitcoin to stablecoins for money laundering purposes.
According to a report by blockchain analytics firm Chainalysis, crypto-related criminal transactions reached $40 billion last year. The estimated total for 2024 is expected to surpass $51.3 billion as additional data is gathered.
Changing Tactics in Crypto Crime
The analysis took into account unlawful activities such as cryptocurrency scams, digital asset fraud, and ransomware attacks. The estimated criminal transaction volume for 2024 is currently only $6.1 billion less than the record set in 2023.
However, the tactics employed by malicious actors have evolved, and the growing institutional adoption of cryptocurrencies has reduced the proportion of illegal transactions compared to legitimate activities. Chainalysis highlighted that stablecoins have become the preferred method for criminals to move stolen cryptocurrency.
In 2021, Bitcoin was responsible for an astonishing 70% of criminal transactions. However, stablecoins have since taken the lead, accounting for 63% of illegal transaction volume. In contrast, only 20% of illicit funds are now laundered through the Bitcoin network.
Legitimate Crypto Volume Surges
Vendors and users on the dark web have also started using the privacy coin Monero, and 10% of illegal transactions involve altcoins.
On the other hand, the volume of legitimate cryptocurrency transactions has seen a significant increase, largely due to institutional adoption from entities like Wall Street. The introduction of spot exchange-traded funds based on Bitcoin and Ethereum has led to a substantial rise in legal trading activity.
This wave of adoption has resulted in a decrease in illegal transactions, which now represent just 0.14% of total cryptocurrency volume in 2024, compared to 0.61% in the previous year.