Chainalysis, a blockchain insights company, in its recent report released on August 15, 2024 has noted that there has been a surge in crypto crimes like theft from centralized exchanges and ransomware attacks in the first half of 2024. As acceptance for cryptocurrency has increased in 2024 due to spot BTC and Ethereum ETFs in the US, it also has generated some concerns as inflows from illicit activity have surged to new heights.
Key Findings
- Overall there has been a 20% reduction in illicit activity during 2024. However, an increase has been observed in stolen funds and ransomware attacks.
- Stolen funds inflows grew by almost 84%, from $857M to $1.58B.
- Ransomware inflows witnessed a meager increase of 2%, from $449.1M to $459.8 in the first half of 2024.
Stolen Funds
The report highlights that average amount stolen per theft has increased by 79.46%, from $5.9M per event (1H-2023) to $10.6M per event (1H-2024). This rise in value per theft can be attributed to the rise in BTC price which has grew by almost 130% in 2024 as compared to 1st half of 2023.
Out of $1.58M stolen funds, 40% (around $632M) were in BTC. Last year, BTC transaction volume in stolen fund activity was around 30% of these flows which indicates a 33.33% rise. It also signifies that hackers have renewed their attacks on centralized exchanges instead of preferring DeFi protocols. A typical example is of DMM centralized exchange, which lost $305M (around 4500 BTC) in 2024. It is believed that attackers including those from North Korea, are also using social engineering (including penetrating the tech industry by getting jobs) to steal crypto.
Ransomware Attacks
The year 2023 had recorded over $1B in ransom payments, $449.1M in the first half and around $550M in the second half. In 2024 through the same period, ransom payments have been $459.8M (2% increase). If we assume that there will be more ransom payments in the second half (on the pattern of 2023), there is a possibility that 2024 will be the record year in ransom payments, exceeding the previous record of $1B.
2024 also witnessed the largest ever ransom payment of $75M to a ransomware group known as Dark Angels. The numbers for largest ransoms in the preceding years of 2021, 2022, and 2023 were $38.9M, $17M, $37.8M respectively. This highlights the gravity of the situation as largest payment amount has almost doubled than previous years. Ransomware attackers now seem to target large businesses which have ability to pay heavy ransoms.
Conclusion
Chainalysis findings highlight the growing landscape of crypto-related crimes. Hackers have shifted their focus to high-value targets and are using sophisticated methods. As the cryptocurrency market continues to grow every year, the need for robust security measures against such threats is more critical than ever.
