While cryptocurrency prices surge, digital asset scams, and hacks are on the decline. According to Blockchain data firm Chainalysis, digital asset-related crime has dropped by over 65% in Q3 of 2023 compared to the same quarter of 2022.
The supporting data behind the analysis report reflects the inflow of digital assets to illicit entities. The firm referred to illegal entities as addresses linked to darknet and ransomware attackers, commonly known as dark market or black market.
As per Chainalysis, inflow of cryptocurrencies to risky entities have also dropped by 42%. These risky entities are used to launder money and erase its origin and ownership.
Digital asset scammers’ revenue must significantly descend over 77% compared to 2022. Chainalysis believes there is a significant reason for the decreasing number of scams as the increasing prices constantly favor the bad actors.
Bitcoin started trading at $17,000 in January 2023, but at press time, it was trading around $30,202 with an intraday trading volume of $14,814,290,019. In the past 24- hours trading volume surged more than 24%.
Historically, scams and hacks follow price-rise episodes in the cryptocurrency market. From January 1 till July 10, scammers succeeded in wiping approximately $445 Million from the industry.
CryptoCurrency Scams in 2023
Hackers celebrated their first day of 2023 by stealing Bitcoin, the most valuable cryptocurrency. Luke Dashjr, Bitcoin core developer, posted on his official Twitter account that hackers illegally obtained his PGP key.
PGP is a standard security procedure that uses the public key system in which every individual user has a unique encryption key known publicly along with a private key only known by the user.
FTX, the bankrupt crypto exchange, informed its creditors in its January 17, 2023, report that the exchange had lost around $415 Million in cryptocurrency due to hacks.
John Ray, current Chief Executive Officer of FTX, noted in an individual report that roughly $323 Million in crypto had been felled from FTX’s international exchange unit, and around $90 Million had been hacked from its US exchange after a bankruptcy filing in November 2022.
On February 2, BonqDAO, a Decentralized Autonomous Organization (DAO), tweeted that “the Bonq protocol was exposed to an oracle hack,” where the exploiter increased the price of ALBT and minted tremendous amounts of BEUR.
The firm informed that “ Bonq protocol had been paused on the platform following the hack”. The attackers minted nearly 120 Million BEUR tokens during the Oracle hack. “The BEUR was swapped for other tokens on Uniswap.
A Decentralized Finance (DeFi) protocol suffered from an exploit that led to $200 Million in losses.
Disclaimer
The views and opinions stated by the author, or any people named in this article, are for informational ideas only and do not establish financial, investment, or other advice. Investing in or trading crypto assets comes with a risk of financial loss.
Nancy J. Allen is a crypto enthusiast and believes that cryptocurrencies inspire people to be their own banks and step aside from traditional monetary exchange systems. She is also intrigued by blockchain technology and its functioning.
Source: https://www.thecoinrepublic.com/2023/07/13/crypto-scams-drop-by-70-in-q3-of-2023-as-crypto-prices-surge/