Last year, more than $4.3 billion in digital currencies was stolen in various crypto scams, according to the latest report by Chainalysis.
Per the New York-headquartered company, the majority of the scams were linked to Ponzi schemes, including the PlusToken and OneCoin scams.
“The vast majority of that $4.3 billion went to just two large-scale Ponzi schemes, without which crime overall would account for just 0.46% of all cryptocurrency activity,” the security firm noted.
“Scammers take advantage of the unique position cryptocurrency currently occupies in the public eye: Most people have heard of it, and many believe it has “get rich quick” potential.”
Though the amount involved in scams dropped in 2018, the number tripled last year to surpass $4.3 billion, duping millions of victims.
Apart from Ponzi schemes, fake token sales, phishing, blackmailing, and fake mixers also contributed to the number.
The FBS CopyTrade Team Presents a New 'FBS CopyStar' ContestGo to article >>
“Over 2.4 million individual transfers were made to Ponzi schemes, a number that becomes even more incredible when you realize that the data above reflects just six individual Ponzi schemes in 2019,” the report stated.
Multi-billion dollar Ponzi schemes are the biggest culprits
The firm also pointed out that the figure is based on the reported number of the most prominent Ponzi schemes, meaning, in reality, this figure can surge further.
The average transfer to Ponzi schemes was $1,676 worth of cryptocurrencies, second only to $4,188 taken in the average transfer to fake token sales, the report outlined.
“Scammers promise massive, outsized returns for those who invest in their fake companies, convincing victims to invest substantial sums in the hopes of a big payout,” Chainalysis stated.
The firm also found that the scammers mostly depend on the exchanges to cash out their illicit funds as 57.6 percent of these illegally obtained digital currencies were liquidated in exchanges.
Apart from the scams, the darknet markets sold over $790 million worth of cryptocurrency last year, surpassing the previous year figure of $600 million.