Cryptocurrency transactions linked to criminal activity hit a new record in 2021 and almost doubled year on year, although their share is shrinking in a booming market.

In 2021, the equivalent of $ 14 billion passed through addresses linked to illegal activities, against 7.8 billion in 2020, estimates the analysis firm Chainalysis on Thursday.

“But these numbers don't tell the whole story.

The use of cryptocurrency has grown at a never-before-seen rate, ”notes the study, with transactions amounting to $ 15.8 trillion in 2021, a staggering 567% increase from the previous year.

The firm specializing in the study of transactions on the blockchain, the technology behind bitcoin and the vast majority of cryptocurrencies, therefore estimates that illegal transactions only represent 0.15% of the total use of cryptocurrencies.

The so-called "carpet draw" scam

In detail, scams alone represent $ 7.8 billion, with the rise in particular of "rug pulls" ("carpet pulling") which have cost investors $ 2.8 billion.

The latter buy a new cryptocurrency, driving up its price, but its creators are selling en masse at the highest price, causing the price to collapse before disappearing.

A particularly publicized example, a cryptocurrency called "Squidcoin" had seen its price increased tenfold in the wake of the successful Netflix series "Squid Game", before seeing its price collapse just a few days after its creation.

Regulators are looking more and more at the cryptocurrency market, which the policeman of the American markets has repeatedly called "the Wild West."

“An encouraging development in the fight against cryptocurrency-related crimes is the growing ability of law enforcement to seize illegally obtained assets directly,” notes Chainalysis.

In June, the American authorities had thus directly recovered the equivalent of $ 2.3 million in bitcoin out of the 4.4 million that the oil company Colonial Pipeline had paid to hackers.

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  • Criminality

  • Bitcoin

  • Fraud

  • Virtual currency

  • Economy

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