Crypto Fraud Losses Fall, But Hacking Sees a 17% Jump in 2024

Despite a booming cryptocurrency market surpassing $10.6 trillion in transaction volume, illicit crypto activity saw a notable decline in 2024. Estimated at $45 billion, the volume of illicit transactions fell 24% year-over-year, accounting for just 0.4% of total crypto flows.

These are the findings of TRM Labs' latest report on crypto crime, which showed that ransomware attacks surged to record highs last year, with North Korean cybercriminals stealing nearly $800 million and financial grooming scams generating billions.

Illicit Crypto Volume: A Moving Target

For example, 2023's illicit volume was initially pegged at $34.8 billion but was later adjusted to $58.7 billion, a staggering 69% revision. If 2024 follows the same pattern, the final figure could exceed $75 billion, reinforcing the difficulty of fully tracking crypto crime in real time.

TRON remained the blockchain of choice for illicit actors, facilitating 58% of criminal crypto flows. However, it also experienced the sharpest decline, with illicit transactions dropping by $6 billion.

Much of this reduction stemmed from targeted enforcement efforts, including the freezing of over $130 million in illicit assets through the T3 Financial Crime Unit. TRON's association with sanctioned entities also played a role, with nearly half of its illicit transactions linked to blacklisted funds.

Sanctioned entities remained the largest contributors to illicit crypto flows, though their share fell by 33% to $14.8 billion. Russia's Garantex and Iran's Nobitex, two of the most prominent crypto exchanges operating under sanctions, accounted for over 85% of these transactions.

Meanwhile, the U.S. and its allies continued tightening enforcement, blacklisting 86 cryptocurrency addresses linked to cybercriminal networks, ransomware groups, and illicit exchanges.

Despite growing interest in privacy-focused cryptocurrencies like Monero, terrorist financing organizations overwhelmingly continued to rely on stablecoins in 2024. Fundraising campaigns linked to extremist groups reportedly used USDT and other stablecoins due to their liquidity and ease of transfer.

Ransomware Hits an All-Time High

Ransomware remained one of the fastest-growing crypto crimes in 2024. Attackers launched 5,635 publicly reported ransomware incidents, surpassing 2023's record-breaking 5,223 attacks.

Crypto hacks and exploits resulted in $2.2 billion in stolen funds in 2024, a 17% increase from the previous year. Decentralized finance (DeFi) protocols remained prime targets, with an average hack size of $14 million. However, no single entity had a more significant impact on crypto theft than North Korea.

North Korean hackers stole nearly $800 million, accounting for 35% of all stolen crypto funds. Their cybercriminal operations, known for targeting private keys and seed phrases, outpaced other threat actors in both sophistication and scale.

While fraud-related losses dropped 40% year-over-year to $10.7 billion, they still represented a significant share of crypto crime. “Pig butchering” scams, where victims are manipulated into fraudulent investments, accounted for at least $2.5 billion, a 58% decline from 2023.