24.2 Billion Dollars in Crypto crimes in 2023

According to a new report from Chainalysis, $24.2 billion funded crypto crimes in 2023. This amount represents just 0.34% of total on-chain transaction volume. Chainalysis notes a preference among criminals for stablecoins. Let’s examine this report together in this article.

Crypto crimes funding surges in 2023

Crypto is commonly accused of being a tool for financing terrorism, money laundering and any other type of crime. Nevertheless, this represents very little of the world’s volume, in contrast to traditional financial institutions or fiat currency, which remain a privileged weak point for the circulation of illegal money flows.
It’s true that criminals sometimes resort to crypto to finance their activities. However, the illegal use of crypto is becoming increasingly marginal, and this prejudice may disappear, thanks to the development of tools for analyzing on-chain (on the blockchain) transactions.

According to a new report from the blockchain analysis company Chainalysis, 24.2 billion in crypto was used to finance crime in 2023. While this amount is certainly significant, it only represents 0.34% of the total volume of crypto transactions in 2023. It is slightly up on 2022 figures. Indeed, $20.1 billion was sent illicitly via crypto in 2022, or 0.24% of all cryptocurrency transactions for the year.

It’s worth remembering that some forms of crypto crime are on a clear upward trend, contrary to general trends. This is particularly true of ransomware and the darknet in 2023.

Criminals abandon Bitcoin in favor of stablecoin

Until 2021, Bitcoin was the cryptocurrency preferred by cybercriminals. This was probably due to its high liquidity. However, this trend has been changing for two years now.

Indeed, the majority of illicit transaction volume has been in stablecoin since 2022. It’s easy to see why accusations against USDT stablecoin are so commonplace from parliamentarians and the UNTether had to freeze certain wallets and integrate secret services to the USDT platform to redeem himself.

Another example is TRON, which was in the spotlight because of the conflict in the Middle East recently. It should be noted, however, that the dominant use of stablecoins is not verified for all forms of crypto crime. Indeed, ransomware and darknet users still predominantly use Bitcoin according to Chainalysis.

The figures given by Chainalysis should be put into perspective

It should be remembered that the figures for Chainalysis should be treated with caution. Estimates are based on transactions involving addresses identified as crime-related. As a result, it is possible that other crime-related addresses have not been identified by Chainalysis. This is commonplace. In 2022, Chainalysis estimated the use of crypto at $20.1 billion before raising it to $39.6 billion following the discovery of new addresses linked to criminals.

In addition, Chainalysis considers the transactions of sanctioned entities to be crime-related. The vast majority of transactions considered by Chainalysis involve services sanctioned by Office of Foreign Assets Control (OFAC) of the US Treasury Department. However, a company sanctioned in the USA may well be legal in another country. This is the case of exchange Garantex which is under US and UK sanctions but operates legally in Russia, where it is based.

Chainalysis’ figures are yet another reminder that crypto isn’t as dirty as it’s made out to be. Although some criminals still use crypto, 99.66% of transaction volume is legal. What’s more, the transparency of the blockchain makes crypto crimes easily detectable. Fiduciary currencies cannot boast this level of transparency.