Chainalysis: Illicit cryptocurrency addresses received more than $24 billion in 2023
According to a recent report by blockchain analytics firm Chainalysis, the value received by illicit cryptocurrency addresses in 2023 amounted to $24.2 billion, marking a significant decrease of nearly 39% from the previous year’s estimated losses of $39.6 billion.
The study also highlighted a shift in the types of assets involved in crypto crime. While Bitcoin (BTC) previously dominated illicit transactions, stablecoins now make up the majority of the volume. This change aligns with the broader trend of stablecoins gaining prominence in legitimate cryptocurrency activities.
However, certain illicit activities, such as darknet market sales and ransomware extortion, still primarily involve Bitcoin. On the other hand, scams and transactions linked to sanctioned entities have shifted towards stablecoins since 2022.
In 2023, sanctioned entities and jurisdictions contributed a significant $14.9 billion to the overall illicit transaction volume, accounting for 61.5% of the total measured throughout the year. This figure is mainly driven by crypto services operating in regions where US sanctions lack enforcement or facing sanctions from the US Department of the Treasury’s Office of Foreign Assets Control (OFAC).
One example is Garantex, a Russia-based crypto exchange that continues to operate due to the absence of US sanctions enforcement in the country. While not all transaction volume from Garantex is linked to illicit activities, exposure to the exchange poses a serious sanctions risk for crypto platforms under US or UK jurisdiction, according to Chainalysis.
OFAC sanctioned Garantex in April 2022, citing over $100 million in transactions associated with illicit actors and darknet markets, including significant amounts from the Russian RaaS gang Conti and the now-defunct Hydra darknet marketplace.
Despite these developments, crypto mixer Tornado Cash managed to launder over $550 million in 2023, even in the face of sanctions.
Overall, the landscape of crypto crime continues to evolve, with stablecoins gaining prominence and sanctioned entities playing a significant role in illicit transactions.
