A report obtained by Reuters from the blockchain forensics company, CipherTrace notes that cryptocurrency heist and fraud in 2019 reportedly spiked by 150% compared to the total amount of losses which was accrued in the past year (2018).
About $4.4 billion was lost to digital currency fraud activities just in the first nine months of this year, a figure which is double the amount ($1.7 billion) of losses recorded for the whole of last year.
The increase, according to the chief executive officer of CipherTrace, Dave Jevans, indicates how criminals are adapting for bigger and better scores. He noted:
Criminals chase money, and the money is right here and ripe for the taking. Little attacks are often easy to defend against, but targeted attacks are far more lucrative.
Two significant events that contributed to the surge were a Ponzi scheme, which was associated with PlusToken, wherein users and customers lost a whopping amount of $2.9 billion to the act.
Cryptocurrencies have attracted intense regulatory scrutiny around the world, as developers and market participants in the space seek to push this asset class into the mainstream.
The other happens to be the sudden death of Gerald Cotten, the CEO, and co-founder of QuadrigaCX, a Canadian crypto exchange, which trapped roughly $136 million belonging to the customers.
Calculatedly, the figures show there is a consistent increase in crypto criminal activity, many of which are underreported since they are considered of less value, especially from the range of $5 million.
The police teams and exchanges now got their eyes only on the more significant existential threats to businesses. Due to this, the crypto industry might be hearing of fewer frauds, while the criminals make way with “bigger wheelbarrows of cash.”
Also, the report noted that 65% out of the top 120 global crypto exchanges have weak know-your-customer (KYC) requirements, a factor that CipherTrace believes will have implications as regulators “seek to have KYC information shared globally.”
Meanwhile, the $4.4 billion figure provided by CipherTrace evidently does not include that $50 million which Coinfomania reported today was lost by South Korean exchange, Upbit.
