Money laundering via cryptocurrency increased by 30% in 2021.
tranthuy02 26-01-2022, 20:52

Chainalysis discovered that DeFi’s involvement in crypto money laundering surged in 2021, along with the entire market’s rise. Despite the rise of DeFi, Bitcoin has remained the primary vehicle for most illegal crypto funding, particularly among online scammers.

Money laundering via cryptocurrency increased by 30% in 2021.

According to new analysis from blockchain forensics startup Chainalysis, money laundering in cryptocurrency increased from $6.6 billion to $8.6 billion between 2020 and 2021.

While centralized exchanges with lax know-your-customer policies continue to be responsible for the lion’s share of wallet addresses used in illegal crypto, value received from illicit addresses increased by about 2,000% on decentralized platforms.

Kim Grauer, Chainalysis’ head of research, said:

“Undeniably the theme this year is the way that DeFi has become a space for criminals,”

However, the majority of money laundering cases passing through DeFi is the result of DeFi hacking. Bad actors seldom utilized DeFi to launder external money; instead, they went to Bitcoin.

Source: REUTERS

The most common source of illicit funding remained pretty standard frauds focused at collecting cryptocurrency.

“This dataset is very conservative, so these are all investigated crimes,” Grauer stated, adding that consideration in the study required more than just suspicion. Perhaps it is for this reason that the business estimates money laundering to account for “just 0.05% of all cryptocurrency transaction volume in 2021.”

Furthermore, practically all of the data was connected to “cryptocurrency-native” crime, as opposed to offline crime transferred into cryptocurrency to be laundered. The dataset also did not include privacy tokens such as Monero, which are immune to this type of analysis.

Throughout the years, a startling amount of illegal money has passed via a tiny group of five main centralized crypto exchanges. Chainalysis’ most recent analysis, as well as Grauer’s, did not mention such exchanges, although a previous study in 2019 did name Binance and Huobi.

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