Chainalysis gave a sneak peek at their 2022 Crypto Crime Report. The full report will be released in February. Scams remained the main form of cryptocurrency-based crimes according to transaction volume. This volume led to more than $7.7 Billion worth of cryptocurrency stolen from victims worldwide.

The $7.7billion total is 81% more than 2020. However, in 2020 scamming activity was significantly lower than 2019. A change that contributed to 2021’s increase in scam revenue was the emergence of rug pulls.

This form of fraud is quite new. It is especially common in decentralized finance (DeFi). A “rug pull” is basically when developers of a new crypto project abandon it unexpectedly, taking users’ funds with them. This malicious maneuver “pulls the rug” out from under investors, hence the name. Research further revealed that cryptocurrency criminals are constantly evolving their strategies.

A financial scam’s average life expectancy is decreasing. In 2021 the average financial scam was only active for 70 days, compared to 192 in 2020. In 2013, the average cryptocurrency-related scam was in operation for 2,369 consecutive days. This number has been steadily declining since 2013. This could be due to the fact that investigators have become more adept at solving and prosecuting frauds. Fraudsters may be more conscious of their actions and feel pressure to shut down before they are brought into the spotlight of law enforcement.

The duration of these scams is declining, but active hoaxes are increasing. An active scam as defined by the Chainalysis report is where the crypto addresses of the “black hats” are receiving funds. Those numbers of active scams rose significantly this year, from 2,052 in 2020 to 3,300 — that marks a 40% jump in less than a year.

Last but not least, scams often appear in waves that coincide with sustained price rises in popular cryptos like and, which in turn can also result in influxes new users.

It doesn’t take research to know that hack attacks and crypto fraud create a huge barrier to successful cryptocurrency adoption, and fighting them can’t be left only to law enforcement and regulators. The media, as well as financial institutions and crypto exchanges have a vital role in educating and informing. Investors ultimately must take responsibility for their crypto education and investment actions — otherwise the funds they invest won’t be theirs for very long.

EMAIL NEWSLETTER

Get the other side of crypto!

Upgrade your inbox and get our DailyCoin editors’ picks 1x a week delivered straight to your inbox.

[contact-form-7]
It takes just one click to unsubscribe.

Continue reading on DailyCoin