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Crypto scams revenue halves in 2020

  • February 18 2021
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Crypto scams revenue halves in 2020

By Cameron Micallef
February 18 2021

Despite 2020 seeing significant growth in crypto markets, with investors looking for protection against the pandemic, the number of victims to crypto crimes has dropped sharply, new research has revealed. 

Crypto scams revenue

Crypto scams revenue halves in 2020

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  • February 18 2021
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Despite 2020 seeing significant growth in crypto markets, with investors looking for protection against the pandemic, the number of victims to crypto crimes has dropped sharply, new research has revealed. 

Crypto scams revenue

A new report by Finaria.it on crypto theft showed that crypto criminals stole US$1.9 billion in 2020, down from US$4.5 billion in 2019.  

This is despite the report showing “more money flowing through digital exchanges created an opportunity for malicious hackers and thieves looking to carry out frauds, scams and theft”, Finaria.it stated. 

The fall in crypto scams in 2020 follows an upwards trend in recent years with CipherTrace’s annual Crypto Anti-Money Laundering and Crime Report revealing that scams soared by almost 165 per cent year-on-year between 2018 and 2019. 

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Although 2020 witnessed an impressive growth of the entire crypto market, crypto crime was down 57 per cent from 2019, dropping to US$1.9 billion. 

The average value taken by criminal actors was 160 per cent higher in 2019 than in 2020, despite the similar number of crypto frauds, showing the maturity in the crypto space and strong precaution measures against threats.

The data shows fraud was the leading crypto crime last year, followed by theft and ransomware. 

Although the total value of crypto crime dropped in 2020, crypto theft jumped by 40 per cent year-on-year and hit US$513 million, still far below the record of US$950 million from 2018.

Last year’s running total largely came from a single fraud, Wotoken, which functioned from July 2018 to October 2019, but was revealed in 2020.

It worked as a classic multilevel-marketing project, but with a higher level of people at the top. 

The scam promised investors unrealistic returns using non-existent algorithmic trading software. 

Ultimately, one Wotoken operator, connected to the infamous PlusToken Ponzi scheme, stole nearly US$1.1 billion in crypto from more than 715,000 victims. China sentenced operators of the crypto Ponzi scheme to years in prison.

Crypto scams revenue halves in 2020
Crypto scams revenue
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About the author

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Cameron is a journalist for Momentum Media's nestegg and Smart Property Investment. He enjoys giving Aussies practical financial tips and tricks to help grow their wealth and achieve financial independence. As a self-confessed finance nerd, Cameron enjoys chatting with industry experts and commentators to leverage their insights to grow your portfolio.

About the author

author image
Cameron Micallef

Cameron is a journalist for Momentum Media's nestegg and Smart Property Investment. He enjoys giving Aussies practical financial tips and tricks to help grow their wealth and achieve financial independence. As a self-confessed finance nerd, Cameron enjoys chatting with industry experts and commentators to leverage their insights to grow your portfolio.

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