• Flexi Group

Cryptocurrency's "illegal wallets" and... whales

As cyberattacks become more common, it is estimated that more than $ 25 billion in cryptocurrencies is held in "criminal wallets."

According to a report by Chainanalysis, which was published by Yahoo Finance, funds from illicit sources increased from $ 3 billion in 2020 to $ 11 billion in 2021, with theft accounting for 93 percent, or $ 9.8 billion, of all cryptocurrencies in circulation.


While this was true, Chainalysis estimated that total criminal activity accounted for at least 0.15 percent of the total economic activity on blockchains during that same time period..


The cryptocurrency market currently has a global market capitalization of $ 1.98 trillion, but crime is on the rise as non-regulated decentralized finance (DeFi) markets emerge as a growing source of concern for law enforcement officials.

A new report predicts that by the end of 2021, the number of encryption whales, or large digital wallets linked to the blockchain and holding at least $1 million in illicit funds, will have increased significantly.


In addition to theft, other sources of money laundering in criminal wallets included "dark" markets ($ 448 million), fraud ($ 192 million), fraudulent stores ($ 66 million), and ransomware ($ 30 million) among other things.


It also appears that criminals are cashing in on their cryptocurrencies at a significantly faster rate, according to the report. During the year 2021, they were in possession of illegal encryption for an average of less than one year, which is at least 75 percent less than the average retention period over the entire period of time.


It was discovered by the Chainalysis team that some of the largest illegal encryption wallets have not moved money in years. However, since the cryptocurrency market reached its zenith in November 2021, the amount of time a criminal whale can hold onto illicit funds has been shrinking almost weekly.


The British tax authorities recently made the historic decision to seize non-financial assets (NFTs) in connection with a tax evasion case involving 1.4 million pounds, as previously reported.


Despite the fact that tax authorities held in custody three people suspected of setting up a complex network of 250 fraudulent companies, the big news came from the announcement that crypto assets worth approximately $500,000 were seized, as well as a quantity of NFTs whose worth has not yet been determined.


NFTs are collectible digital assets that have value both as an alternative form of digital currency and as a form of a product, such as an art board or a vinyl record, among other things. Its primary advantage is that it is a one-of-a-kind digital asset that can provide the owner with the level of individuality he desires. Every field, from painting to sports, from music to economics, saw an explosion in the popularity of NFTs in the past year, resulting in the emergence of a $ 40 billion market that is rapidly expanding.


The seizure of cryptocurrency and non-financial tokens (NFTs) was presented by the British authorities as evidence that they are attempting to deter those who attempt to use cryptocurrencies for tax evasion and that they have the means to do so. As the head of the financial crime department stated, "we are constantly adapting to new technology to ensure that we keep up with the pace of criminals and their attempts to conceal assets."

By fLEXI tEAM

4 views0 comments