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Cyber Crimes Cost Crypto Sector $1.36 Bln In First Five Months Of 2020: Report

cybercrime may03 02jun20 lt

Cyber Crimes have siphoned off a total of about $1.36 billion in the first five months of 2020 from the crypto sector, according to the "Spring 2020 Cryptocurrency Crime and Anti-Money Laundering Report" from blockchain analytics and security firm CipherTrace.

These include crypto thefts, hacks, and frauds. Nearly $1.3 billion or 98 percent of the amount is attributed to blockchain fraud and misappropriation.

This is compared to the $4.5 billion lost in the whole of 2019, $1.7 billion in 2018 and $169 million in 2017, due to similar crypto-related crimes.

The current figures suggest that 2020 could see the second-highest value in crypto crimes ever recorded after 2019.

In the five months, Coronavirus-related phishing sites were found to be the most popular. COVID-19-inspired fraud is generally executed by luring victims off legitimate platforms into chat rooms where payment in bitcoin can be requested.

COVID-19 related products sold on the dark web were also popular. However, dark web PPE sales have been mostly unsuccessful. Though the majority of COVID-19-related products advertised on darknet markets did not net many sales, phishing kits were relatively successful.

The 2020 amount primarily include a billion-dollar ponzi scheme run by Wotoken in China, being the largest contributor. The scam promised investors unrealistic returns using a non-existent algorithmic trading software. Ultimately, one Wotoken operator stole an estimated $1 billion in crypto from over 715,000 victims.

Coronavirus scams also contributed to the net earnings of crypto crime. While governments funnel resources into mitigating the impact of the pandemic, criminals are taking advantage of the lack of oversight.

COVID-19-related fraud also took form of impersonations of legitimate entities, such as The Red Cross, to extract personal information and/or payment in cryptocurrencies. They also include applications that claim to support victims but are actually spying on users.

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