Why did crypto scams witness a fall in 2022: Report

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Why did crypto scams witness a fall in 2022: Report

 Why did crypto scams witness a fall in 2022: Report
Image source: © Tarikvision | Megapixl.com

Highlights

  • According to Chainalysis’ Mid-year Crypto Crime Update report the total scams dipped by 65% compared to the same period last year.
  • In 2021, crypto-based crimes were at an all-time high as the illicit addresses had reportedly received over US$14 billion over the year.

The year 2022 for the crypto markets has been a turbulent one so far. Not only has the market been going through an extremely volatile situation in the majority of crypto tokens in the past seven months or so, but it had also witnessed a fall of stablecoins. As a result, the markets have reacted quite severely to sudden price changes, especially during May and June. 

Amid all this, according to a report released by data aggregator Chainalysis, the only silver lining within the cryptocurrency market is the total scam revenue in the first seven months of the year. The Mid-year Crypto Crime Update reveals that the total scams dipped by 65% compared to the same period last year.  

In fact, the overall scam revenue for the first seven months of the year stands at US$1.6 billion suggesting that this drop may be because of the declining prices of cryptos, especially in May and June. In 2021, crypto-based crimes were at an all-time high as the illicit addresses reportedly received over US$14 billion over the course of the year, according to the Chainalysis Crypto Crim Report 2022.  

Why the sudden dip? 

The sudden dip may also be accounted for by the fact that inexperienced users decided to stay away from the crypto market. Usually, it’s the beginners who often fall prey to scams especially in a bull market as they are drawn in by the hype and in hope of reeking quick returns. 

But contrarily, in a bear market, even a beginner tends to stay away from the market fearing losing money. 

Despite that, in 2022 so far, the top three scams were JuicyFields.io, Unique-Exchange.co/PARAIBA.world and OmegaPro.world, with the scam revenues amounting to the total value received through July resulting in US$273,935,606, US$267,487,674 and US$106,449,195 respectively. 

However, the figures were far lesser than the scams of 2019 or 2021 which saw PlusToken and Finiko, net US$2 billion and US$1.5 billion respectively.  

Bottom line 

Even though the scam rate would be down, but it doesn’t necessarily mean that one should take things for granted. Therefore, it’s imperative that one is on a constant vigil and does proper market research before taking critical investment decisions. 

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