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CipherTrace: Losses in crypto crimes dropped to $681 million in July

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TL;DR

TL;DR Breakdown:

  • Losses in crypto crimes have dropped significantly since January 2021.
  • However, the criminal records in the DeFi are still soaring, with about $474 million lost so far. 

A new report from CipherTrace confirms a significant drop in total losses incurred in crypto crimes this year, despite a spike in decentralized finance-related crimes. The decrease is a testament to the industry’s growing level of security infrastructure and maturity, according to the cryptocurrency intelligence company.

Financial losses in crypto crimes drop to $681 million

Following the CipherTrace report on Tuesday, the losses from crypto crimes have been declining for the past two years. However, the record so far in 2021 indicates a significant decline compared to the previous years. In the first seven months of 2021, losses in the overall cryptocurrency market reportedly declined to $681 million. 

The record today represents about 64 percent decrease in the $1.9 billion loss recorded for the whole of 2020 and an 84 percent decrease in 2019’s $4.5 billion loss.  

DeFi crime keeps surging 

The decentralized finance space contributed the most to the losses so far this year. Between January to July, the DeFi space recorded criminal losses of $474 million. Per the report, crypto crimes involving DeFi platforms are at a record high. 

About 76 percent of DeFi crimes were as a result of protocol hacks ($361 million), and 24 percent were identified to be as a result of Rug pulls ($113 million). Rug pull refers to cases where developers suddenly exit their projects, leaving with users invested capital. 

It shouldn’t come as a surprise that as the DeFi ecosystem expands, so are DeFi crimes. […] Just eight months into 2021 and DeFi hacks, thefts, and frauds have already surpassed the total DeFi crimes from 2020. This means regulators around the globe are paying closer attention to DeFi specifically.

says CipherTrace CEO Dave Jev

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Ibiam Wayas

Ibiam is an optimistic crypto journalist. Five years from now, he sees himself establishing a unique crypto media outlet that will breach the gap between the crypto world and the general public. He loves to associate with like-minded individuals and collaborate with them on similar projects. He spends much of his time honing his writing and critical thinking skills.

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