Crypto Crime Trends in 2024

Crypto crime is on the decline, particularly on TRON, as highlighted in a preview of TRM Labs’ 2024 Crypto Crime Report.

Illicit on-chain volume has decreased by 24% since 2023, now totaling $45 billion, which constitutes just 0.4% of overall crypto transactions despite a 56% increase in cryptocurrency transaction volume last year, exceeding $10.6 trillion.

TRM Labs attributes this reduction to enhanced initiatives by law enforcement and participants within the crypto industry to combat illegal activities.

Focus on TRON

This trend is notably evident on TRON, the blockchain created by Justin Sun, which recently initiated a partnership aimed at identifying and disrupting criminal networks in collaboration with Tether and TRM Labs.

Together with global law enforcement, this newly formed T3 Financial Crime Unit announced the freezing of approximately $130 million in USDT assets linked to suspected crimes. They reported monitoring over $3 billion in USDT transactions since their inception in August.

Decline in Illicit Activity

The strategy seems effective, as TRM Labs indicates that illicit activities on TRON are rapidly decreasing. They reported a $6 billion drop in illicit volume, with such activities nearly halving in proportion.

However, TRON continues to be the most commonly utilized blockchain for criminal purposes, representing 58% of total illicit volume. In comparison, Ethereum accounts for 24%, and Bitcoin for 12%, largely due to factors like lower transaction fees and the availability of stablecoins.

This aligns with a 2024 UN report which identified USDT transactions utilizing TRON’s TRC-20 protocol as “a preferred choice” among criminals. Tether notes that almost $60 billion in USDT exists on TRON, making it the second-largest issuance after Ethereum.

Nature of Illicit Activities

The report indicates that sanctions violations constitute about one-third of illicit volumes across monitored networks, while scams and fraud represent approximately one-quarter of the total. Notably, fraud-related inflows saw a 40% decline in 2024, yet still remain high at $10.7 billion.

The investment scam known as pig butchering, which involves gaining victims’ trust, also dropped to an estimated $2.5 billion lost. It is essential to point out that these figures are often revised upward as new information surfaces and investigations conclude in subsequent months.

Areas of Concern

Conversely, instances of crime have increased in some areas. Ransomware attacks and hacks, notably from North Korean and Russian actors, have reportedly surged, with demands reaching “unprecedented levels.” Additionally, TRM Labs found an uptick in terrorist financing via cryptocurrency in 2024.

Conclusion

In conclusion, TRM Labs states, “The fight against crypto crime requires a proactive, collaborative approach. Regulatory bodies, law enforcement agencies, and private sector partners must continue to adapt, innovate, and cooperate to outpace increasingly sophisticated threat actors.”