What is a crypto crime?

Anany sharma
4 min readApr 17, 2022


Technology has made almost every aspect of our lives — and the lives of criminals — easier. The blockchain has fostered an ecosystem in which illicit actors can easily operate anonymously and internationally, stalling financial investigations and setting the stage for the increased crypto crime. It’s no surprise. Crypto crime has been on the rise — especially since the pandemic began. How are these crimes committed? And what can you do to stay ahead of scammers?

Direct theft vs scams

There are two main ways criminals obtain cryptocurrency: stealing it directly or using a scheme to trick people into handing it over.

In 2021, crypto criminals directly stole a record US$3.2 billion (A$4.48 billion) worth of cryptocurrency, according to Chainalysis. That’s a fivefold increase from 2020. But schemes continue to overshadow outright theft, enabling scammers to lure US$7.8 billion (A$10.95 billion) worth of cryptocurrency from unsuspecting victims.

Crypto crime is a fast-growing enterprise. The rise of the crypto economy and decentralized finance (or Defi), coupled with record cryptocurrency prices in 2021, has provided criminals with lucrative opportunities.

Australian data confirm the global trends. The Australian Consumer and Competition Commission reported more than A$26 million was lost to scams involving cryptocurrency in 2020 from 1,985 reports. In December, federal police told the ABC crypto scam losses for 2021 exceeded A$100 million. That’s despite many incidents likely left unreported, often due to embarrassment by victims.


Robbery is worse than burglary. It’s when a criminal confronts you on the street, points a gun at you, and says something like “your wallet and jewels or your life.” Most people do what the robber says and hope to live another day. The new wave of cybercrime is robbery a.k.a ransomware: not just sneaking into your computer but encrypting everything and “tying your computer up” until you pay the ransom.

Ransom attacks on computers have always existed, but they were fairly rare, because there was no way the robber could collect the victim’s money without revealing himself. Then Bitcoin came along. Bitcoin enables anyone to buy it from an exchange like Coinbase and then send it to the criminal’s anonymous Bitcoin address. The criminal, who could be anywhere, then has your money and may, if he feels like it, release your computers from their electronic shackles.

“eCrime — a broad category of malicious activity that includes all types of cybercrime attacks, including malware, banking trojans, ransomware, mineware (cryptojacking) and crimeware — seized the monetization opportunity that Bitcoin created. This resulted in a substantial proliferation of ransomware beginning in 2012…

On the other hand…

Cryptocurrency utilization is exploding, most of it unrelated to criminal activity. It is certainly true that crypto-related crime has grown; one respected vendor reports it nearly doubled from 2020 to 2021, reaching an all-time high of $14 billion. That same vendor reports even more dramatic growth of overall cryptocurrency transactions, which was more than five times in the same period. As the vendor says: “Transactions involving illicit addresses represented just 0.15% of cryptocurrency transaction volume in 2021 despite the raw value of illicit transaction volume reaching its highest level ever. As always, we have to caveat this figure and say that it is likely to rise as Chainalysis identifies more addresses associated with illicit activity and incorporates their transaction activity into our historical volumes. For instance, we found in our last Crypto Crime Report that 0.34% of 2020’s cryptocurrency transaction volume was associated with illicit activity — we’ve now raised that figure to 0.62%.”

Supporters of crypto are also quick to point out that fiat currency is also used by criminals, so no one should be surprised that crypto is used by them.


Cryptocurrencies are widely discussed. “Bitcoin Billionaires” are in the news; hosts of ordinary people hope to be like them. The crypto industry sponsors reports and generally promotes the idea that the criminal use of crypto is minimal and going down. Which it is, as a share of all crypto transactions. As we know from the growth of ransomware attacks, the use of crypto by criminals is in fact increasing.

It should be illegal for any regulated exchange to enable sending to or receiving from any address that fails to have full KYC and other identity disclosure with it. There are lots of exchanges that operate internationally for the criminals to continue using, as they will.

Cryptocurrencies are an amazing technical achievement. Computers and networking already provide rich ground for criminal activity; Bitcoin added a safe-for-criminals international payment method that has fueled computer-based crime.

Information source — Forbes.com

Thank You for visit — Anany Sharma



Anany sharma

Security used to be an inconvenience sometimes, but now it’s a necessity all the time. — Martina Navratilova.