Crime Report: Illicit trades on-chain shot up in 2024

The cryptocurrency industry is becoming more mainstream than ever. More dumb money floods in with every bull cycle – and cybercriminals lick their lips. Legitimate adoption brings an increase in illicit activities, with threats ranging from international security issues to consumer protection concerns.

According to a new Chainalysis 2025 report, on-chain illicit activity has become more diverse, with some actors using crypto primarily for money laundering imported from off-chain.

Donald Trump’s questionable $TRUMP and $MELANIA meme coins have raised billions of dollars in market cap, and concerns about ethics and regulation. Investors should be more vigilant than ever with what they buy and how they interact with crypto.

2024 Crypto Crime in Numbers: How Big Was It?

The criminal proceeds received by illicit cryptocurrency addresses in 2024 is estimated at $41 billion. This is down from previous years, so should we celebrate? Chainalysis noted that the number will go up as more illicit addresses are identified, pushing the final total above $51 billion.

For comparison, the 2023 estimate was initially at $24.2 billion before ballooning to $46.1 billion. The report excludes revenue from non-native crypto crimes.

The rise in cryptocurrency value sent to illicit addresses from 2020 to 2024 shows that bad actors are upgrading their tactics. Yet the share of all crypto transaction volume that can be linked to illicit activities fell to 0.14% in 2024, from 0.7% in 2020.

Which Assets Were Widely Used in Illicit Activities in 2024?

There has been a significant shift in the types of cryptocurrencies involved in illicit activities, marking a clear departure from Bitcoin’s dominance. Bitcoin was the currency of choice for cybercriminals in 2020, accounting for nearly three-quarters of all illicit transactions. This was simply due to its high liquidity and recognition at the time.

Other assets gained market share and the situation changed. Stablecoins account for more than six out of ten illicit transactions, marking 77% year-over-year growth. This shift mirrors the broader trend in the crypto market where they are used more to transfer fixed values, getting away from the volatility of Bitcoin. However, centralised stablecoin issuers like Tether have frozen funds linked to crimes such as scams and terrorism financing.

Even then, other forms of crypto crime continue to revolve around Bitcoin. Ransomware and darknet market (DNM) transactions still predominantly rely on BTC, illustrating its persistent role in specific illicit activities.

Privacy coins like Monero have seen a rise in usage within the DNM space. Other forms of crypto crime, such as scams or money-laundering, involve a very wide range of assets, reflecting the diverse ways illicit actors are adapting to the growing crypto industry.

The report also revealed that transactions involving sanctioned entities, especially in jurisdictions where access to the traditional financial system is restricted, lean toward stablecoins. The bottom line is that cryptocurrencies are used everywhere, even in conflict zones.

Authorities will look at these to try to understand illicit activities. They will have their work cut out, as it has been previously reported that less than 10% of stablecoin transactions are from real users.

Stolen Funds and Scams: North Korean Hackers Run the Show

Stolen funds increased by 21% year-over-year, reaching $2.2 billion. While decentralized finance (DeFi) platforms were the primary targets for these thefts, centralized services took the damage in the second and third quarters of 2024.

North Korea, as is slowly becoming the norm, is responsible for the lion’s share of these hacks. North Korea stole a record $1.34 billion in 2024, up from $660.5 million the previous year. These hacks are increasingly carried out by North Korean IT workers who infiltrate crypto and Web3 crypto companies to use advanced tactics to compromise private keys. This tactic has been used in nearly 44% of all stolen crypto in 2024.

High-yield investment scams and ‘pig butchering’ schemes flourished in 2024. With AI being one of the biggest crypto narratives, it was only a matter of time before it was used in scams. Bad actors used AI to bypass KYC regulations. Crypto ATM scams are also on the rise, targeting the elderly.

Law Enforcement Closes in on Ransomware

Ransomware remains a major threat. It continues to generate millions of dollars despite two major challenges: law enforcement disruption, and a decrease in victim willingness to pay ransoms. Attack volumes remained stable in 2024, but the payments made were lower than in previous years.

Darknet markets (DNMs) saw a slight decline in revenue, earning $2 billion compared to nearly $2.3 billion in 2023. Fraud shop activity dropped sharply by more than half, totaling $220.1 million. This decline in fraud shop volumes can be partly attributed to a major U.S.-Dutch operation that dismantled the Universal Anonymous Payment System (UAPS), a crypto-processor used by numerous fraud shops.

Crypto Crime Is Getting More and More Complex

Crypto crime is becoming diverse and professional as organized groups use digital assets for a wide range of traditional crimes. In 2024, a sizable portion of the $40.9 billion received by illicit crypto addresses came from entities providing the infrastructure and services necessary for criminal operations, such as laundering and hacking tools.

Huione Guarantee serves as a prime example of the growing professionalization of crypto crime. The marketplace has processed over $70 billion in crypto transactions since 2021, facilitating illicit activities such as servicing sanctioned entities.

Wrapping Up

Crypto criminal networks are bigger and more sophisticated than before. The ball is in the authorities’ courts to thwart the rising complexity of crypto crime before it spirals beyond control. Whether they will get the support under a Trump administration is still debatable.

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