Corona-led Price Drop Casts Pall Over Crypto Scammers’ Revenues

The last few weeks have not been good for crypto fraudsters as the value of digital assets has steadily dropped. The latest change in correlation has come amid a health crisis triggered by the coronavirus pandemic.

Data from Blockchain Blockchain Blockchain comprises a digital network of blocks with a comprehensive ledger of transactions made in a cryptocurrency such as Bitcoin or other altcoins.One of the signature features of blockchain is that it is maintained across more than one computer. The ledger can be public or private (permissioned.) In this sense, blockchain is immune to the manipulation of data making it not only open but verifiable. Because a blockchain is stored across a network of computers, it is very difficult to tampe Blockchain comprises a digital network of blocks with a comprehensive ledger of transactions made in a cryptocurrency such as Bitcoin or other altcoins.One of the signature features of blockchain is that it is maintained across more than one computer. The ledger can be public or private (permissioned.) In this sense, blockchain is immune to the manipulation of data making it not only open but verifiable. Because a blockchain is stored across a network of computers, it is very difficult to tampe Read this Term analytics firm Chainalysis shows that cryptocurrency scammers have made revenues less than ever since early March as Bitcoin and other altcoins have been on a downward spiral with little sign of change.

The total daily value sent to cryptocurrency scams dropped 61 percent between March 13 and March 31, though it has recovered mildly in early April.

Bitcoin topped out at $10,500 in mid-February and fell as low as $3,867 in March. As prices fell, so did the value of Cryptocurrencies Cryptocurrencies By using cryptography, virtual currencies, known as cryptocurrencies, are nearly counterfeit-proof digital currencies that are built on blockchain technology. Comprised of decentralized networks, blockchain technology is not overseen by a central authority.Therefore, cryptocurrencies function in a decentralized nature which theoretically makes them immune to government interference. The term, cryptocurrency derives from the origin of the encryption techniques that are employed to secure the netw By using cryptography, virtual currencies, known as cryptocurrencies, are nearly counterfeit-proof digital currencies that are built on blockchain technology. Comprised of decentralized networks, blockchain technology is not overseen by a central authority.Therefore, cryptocurrencies function in a decentralized nature which theoretically makes them immune to government interference. The term, cryptocurrency derives from the origin of the encryption techniques that are employed to secure the netw Read this Term sent to scammers from $800,000 to $300,000.

According to Chainalysis’ report, the majority of the funds were linked to investment scams and Ponzi schemes. Although both scam categories represented a majority of the funds cryptocurrency scammers obtained, they didn’t account for the full losses. Apart from them, they also used blackmailing, fake cryptocurrency mixers, phishing, and fake token sales.

Per the security firm, scammers have been taking advantage of the explosion of scams related to the coronavirus outbreak. But since the week ending March 8, the weekly average amount being sent to investment scams and Ponzi schemes dropped by 33 percent, from $4.2 million to just under $2.9 million.

Chainalysis has a few rivals in the market

A new wave of scammers is using the coronavirus outbreak to deceive people. By presenting themselves as members of popular health and charity organizations, they trick victims into sending them bitcoins.

“In short, while Covid-19 is providing phishing and blackmail scammers with new fraudulent stories to entice victims, the cryptocurrency price drops spurred by the pandemic have drastically reduced the revenue of the Ponzi schemes and investment scams that make up most cryptocurrency scamming activity,” Chainalysis concludes.

Chainalysis is a New York-based provider of compliance software for real-time monitoring of cryptocurrencies transactions. Over the past year, Chainalysis deployed its real-time anti-money laundering and compliance software, and also expanded its coverage beyond Bitcoin to include Ether, Litecoin, Bitcoin Cash, and stablecoins.

Chainalysis’ compliance software can help both crypto firms and law enforcement agencies detect suspicious activity in order to battle any related criminal activity. It uses pattern recognition, algorithms, and millions of open source references to “identify and categorize thousands of cryptocurrency services to raise live alerts on transactions involved in suspicious activity,” the company says.

The company has already signed other major cryptocurrency exchanges, including the likes of Binance, to automate their process of screening transactions and monitoring user activity.

Chainalysis has a few rivals in the market whose solutions strive to prevent, detect, and investigate cryptocurrency money laundering, fraud, and compliance violations. The biggest competitor, though, is the UK-based Elliptic, which offers proprietary compliance and fraud detection technology.