Bitcoin whales: Crypto criminals are now among the biggest holders of cryptocurrencies, says report

Crypto whales are investors holding $1 million or more in cryptocurrency. Overall, 4,068 criminal whales holding over $25 billion worth of cryptocurrencywere identified.

Crypto criminals or criminal entities and individuals holding cryptocurrencies are now among the biggest crypto holders globally. In fact, these crypto criminals accounted for 3.7 per cent of all crypto whales in 2021, according to a report by Chainalysis on crypto-related crime. Crypto whales are investors holding $1 million or more in cryptocurrency. Overall, 4,068 criminal whales were identified in the report holding over $25 billion worth of cryptocurrency.

Most criminal whales received either a relatively small or extremely large share of their total balance from illicit addresses. The lowest-share bucket was the biggest with 1,374 criminal whales that received 10-25 per cent of their total balance from illicit addresses. The largest-share bucket was close behind with 1,361 criminal whales that received 90-100 per cent of their total balance from illicit addresses. 

Moreover, the report showed that the crypto amount held by crypto criminals, also called criminal balances in the report, jumped nearly 4x from $3 billion in 2020 to $11 billion in 2021. This was dominated by stolen funds. As of the end of 2021, stolen funds accounted for 93 per cent of all criminal balances at $9.8 billion. Darknet market funds were next at $448 million, followed by scams at $192 million, fraud shops at $66 million, and ransomware at $30 million.

Also read: Bitcoin critic Warren Buffett invests $1 billion in neobank that provides crypto-related services

Thanks to the blockchain infrastructure, criminals in crypto-based crime can be tracked more efficiently while their holdings can be quantified from one public data set in comparison to fiat-based crime, the report said. “In fiat, the highest net worth criminals have murky networks of foreign banks and shell corporations to obfuscate their holdings. But in cryptocurrency, transactions are saved on the blockchain for all to see.” This is enabling government agencies around the world to seize crypto from criminals and bring them to justice, Chainalysis said. 

The growth of illicit activities in the crypto market and rising cases of crypto crimes were highest in 2021 even as investors continued to bet on cryptocurrencies. Crypto laundering in 2021 had jumped 30 per cent to $8.6 billion, the second-highest in five years, in comparison to $6.6 billion in 2020 and $10.9 billion in 2019.

Financial Express Telegram Financial Express is now on Telegram. Click here to join our channel and stay updated with the latest Biz news and updates.


Posted

in

by

Tags:

Comments

Leave a Reply

Your email address will not be published. Required fields are marked *