Illicit crypto transactions in 2024 are likely to surpass 2023’s record, as criminals pivot from Bitcoin to stablecoins for laundering stolen funds.
Blockchain insight provider Chainalysis reported $40 billion in crypto-related criminal transactions last year, with the estimated total expected to rise above $51.3 billion as more data is collected.
The report considered illegal activities such as crypto scams, digital asset fraud, and ransomware attacks. At current estimates, 2024 is just $6.1 billion shy of the record criminal transaction volume analyzed in 2023.
Still, bad actors have changed tactics, and institutional adoption has shrunk the ratio of illicit transactions relative to legitimate activity. Chainalysis noted that stablecoins have become the preferred method for moving stolen crypto.
In 2021, Bitcoin (BTC) accounted for a staggering 70% of criminal transactions. However, stablecoins now dominate, comprising 63% of illicit transaction volume, while only 20% of illegal funds are now laundered through the Bitcoin network.
Dark web vendors and users also turned to privacy coin Monero (XMR), while 10% of illegal transactions involve altcoins.
Meanwhile, legitimate crypto volume has surged, driven by institutional adoption from Wall Street. The launch of spot exchange-traded funds based on Bitcoin and Ethereum (ETH) has significantly increased legal trading activity.
This adoption wave has reduced illicit transactions to just 0.14% of total crypto volume in 2024, compared to 0.61% in the previous year.
