Global crypto community sends $4.68bn to scam accounts in a year
A new report has revealed that the global crypto community lost $4.68bn (£3.4bn) to scams last year with Western Europeans hit hardest.
Crypto holders in West Europe sent $1.4bn worth of crypto to illicit addresses last year, more than any other region, with $1.1bn of assets being sent to scam accounts according to Chainalysis.
Kim Grauer, the director of research at Chainalysis, said that the research highlighted key “global trends” in illegal crypto activity. With scams “by far the most lucrative form of crypto currency crime across all regions.”
Eastern Europe was also a hot spot for crypto crime with scams making up a large share of illicit activity in the 12 months ending in June 2021. A total of $815m was lost to scams with a single site called Finiko, a Russia-based Ponzi scheme, accounting for the majority of losses.
East Asia was also hit particularly hard with crypto holders sending $606m to scam accounts while investors in North America sent $563m.
Transaction volume associated with scams accounted for 73 per cent of illicit crypto activity worldwide over the period.
Grauer commented on the data saying: “this suggests the cryptocurrency industry has work to do to educate their users about common red flags and implement programs to prevent scammers from stealing money from people.”
The crypto market has been plagued by scam exchanges, mining projects and coins since its early days. The new data sends the message that despite leaps forwards in safety standards and regulation scammers are still highly successful at getting traders to part with their money.
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