Chainalysis report details increase in money laundering via crypto

Chainalysis report

TL; DR Breakdown

  • Chainalysis report highlights an increase in money laundering via crypto
  • Laundered crypto hits $30 billion in five years
  • The report highlights the transparency of blockchain

Over the years, there has been one issue of ill or another in the crypto sector. This shows that some traders’ concerns about entering the market are valid. Despite a widespread clampdown on these malicious actors, they always find a new way to reinvent themselves. This is highlighted in the latest Chainalysis report, which details the increase in money laundering across the crypto sector.

Laundered crypto hits above $30 billion in five years

According to the Chainalysis report, these malicious actors could contribute about $8.6 billion to the amount of illicit cash laundered through the crypto sector. Although the data analysis body saw a sharp increase compared to two years ago, the figure still has a wide gap compared to 2019. In its 2019 report, Chainalysis said that about $10.9 million in crypto were laundered in the sector. However, the record-keeping company also announced that the figures have hit above $30 billion over a five-year duration.

Also, the company mentioned that these figures are minuscule compared to what is being laundered in the physical sector. The Chainalysis report registers that about $2 trillion gets laundered every year from illicit activities like drug trafficking and the like. However, the report states that the amount is estimated as physical cash holds to direct paper trail that one can follow to monitor movements, unlike crypto.

Chainalysis report highlights blockchain transparency

The Chainalysis report also discussed the vast differences between physical cash trading and online transactions. It mentioned that blockchain is transparent and has been able to help officials track these assets. With that, they can view which wallets house what illicit gotten digital asset and gets a notification when it gets moved into another wallet. Chainalysis also mentioned that the criminals derived more value in laundering through digital assets than physical cash.

The Chainalysis report also highlights the drop in money laundering through centralized exchanges, representing just 47% of the entire figure. This is the first time since 2018 that the figure will be this low. However, the decentralized finance sector has seen its usage for laundering hit a new high after touching a massive 17% from its previous 2% in 2020. Chianalysis mentioned that the behavior shows that high-grade hackers like the Lazarus group have now moved to DeFi while petty scammers are still using centralized exchanges. Grouping by assets, the Chainalysis report mentioned that altcoins were top in the list, with about 68% of laundered funds entering into diverse wallets.

Owotunse Adebayo

Owotunse Adebayo

Adebayo loves to keep tab of exciting projects in the blockchain space. He is a seasoned writer who has written tons of articles about cryptocurrencies and blockchain.

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