Illicit crypto volumes rose in 2022, according to blockchain analytics firm Chainalysis, with a US-sanctioned Russian exchange being a dominant source.
The value of crypto transactions related to illicit activities rose for the second consecutive year in 2022 to $20.1 billion, according to a Chainalysis report, up from $18 billion in 2021. Around 44 percent of 2022’s illicit transaction volume was from activity associated with sanctioned entities with much of it originating from Russian exchange, Garantex.
Chainalysis defines wallets as «illicit» if they are part of a sanctioned entity.
Non-Theft Crime
While the volume of stolen crypto rose 7 percent, other illicit crypto transactions – including scams, ransomware, terrorism financing and human trafficking – fell in 2022.
Chainalysis cited the market downturn as a potential driver to the drop, noting that crypto scams have historically taken in less revenue during bear markets.
Conservative Estimate
Chainalysis also said that the $20.1 billion figure only includes recorded on-chain activity and excludes off-chain crimes, like fraudulent accounting by crypto firms, as well as crypto proceeds from non-crypto-related crimes, like drug trafficking payments.
«We have to stress that this is a lower bound estimate – our measure of illicit transaction volume is sure to grow over time,» the report said, adding that the 2021 figure was revised upwards by $4 billion after more scams were discovered.
