Cryptocurrency crime is not expected to be a big nuisance this year, according to a recent report looking at crypto crime trends for 2022.
NEW YORK, NY - APRIL 15: A hacker using a laptop computer at the Hacked By Def Con Press Preview during the 2016 Tribeca Film Festival at Spring Studios on April 15, 2016 in New York City.
This is mainly due to law enforcement apparently taking a "better advantage" of the transparency of blockchain technology, reports Cointelegraph. As such, people can look forward to fewer instances of illicit transactions being performed using crypto.
The report, which came from the research firm Chainalysis (a firm that focuses on providing updated research data on blockchain tech), reveals that legitimate crypto usage is "far outpacing the growth" of illegal usage. In 2021 alone, the volume of crypto-related crime was at its lowest at 0.15%, with regards to overall transactions.
According to Chainalysis Director of Research Kim Grauer, this exceedingly low figure will remain as it is barring any "outlier events."
In 2021, all crypto-related revenue generated by illicit addresses topped out at $14 billion, as shown by Chainalysis. While this might sound massive, this pales in comparison to the total value of every single crypto transaction last year: an insane $15.8 trillion.
It is this incredible increase in adoption that is likely encouraging criminals to adopt cryptocurrencies. However, these so-called "bad actors" are likely not realizing the potential of blockchain technology to be not as anonymous as previously thought.
As such, authorities are cracking down hard. Late last year, it was revealed that the IRS seized $3.5 billion worth of crypto assets from illegal activities.
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They've also previously put Binance, one of the world's largest cryptocurrency trading platforms, for the alleged increase in illegal transactions-particularly money laundering-happening under them.
With the world being continuously captivated by the idea of digital, decentralized currencies, this could be of great news to potential investors who want to try their luck.
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Why Cryptocurrency Crime Is More Or Less A Myth
An article on Forbes clapped back against claims made by Treasury Secretary Janet Yellen, who basically said that digital currencies are widely used in illegal activities. Contrary to what is believed, illegal crypto transactions still lag behind those made using traditional currencies (aka cash).
An Indian money changer poses as he counts US Dollar currency notes at his office in New Delhi on October 24, 2008. India's central bank kept its key interest rates steady but declared it was ready to take "unconventional" and swift measures to deal with the global financial crisis. AFP PHOTO/ MANAN VATSYAYANA
This all links back to how crypto (and blockchain technology, in general) works. Digital currencies are not untraceable, because every single transaction is recorded on a blockchain as an address. Anyone with the right skills and resources can trace that address to follow any alleged illicit transaction down the line.
In truth, any criminal who wishes to hide their tracks should really stick to old-school methods: launder actual cash. It is almost impossible to trace cash, which is why large-scale operations (mostly money laundering) almost involves actual stacks of bills rather than anything else on a blockchain.
What's Next?
Despite this analysis, however, anybody should still be wary of cryptocurrency crime. According to Grauer, new tech like DeFi, DAOs, and NFTs remain ripe for criminal pickings.
If you want to get a taste of that crypto pie, be on high alert and take great care of your investment-lest you lose it all in one fell swoop.
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Written by RJ Pierce
