2024 Crypto Assets Crime Situation Analysis Report

The year 2024 is a milestone year for the Web3 industry. The market capitalization of Crypto Assets and the adoption of industry infrastructure have reached unprecedented heights, while criminals have also begun to utilize encryption infrastructure more to optimize their operations or create new crime patterns. This report clarifies the impact of compliance measures on the scale of the crime industry by statistically analyzing and disclosing the scale of major types of crypto crime, and calls on the industry and government to pay attention to the harm caused by crypto crime.

Crypto Assets crime situation remains severe

In 2024, the total scale of high-risk addresses receiving stablecoins reached $649 billion, slightly higher than the previous year. These high-risk activities accounted for 5.14% of the total trading activities of stablecoins that year, although this is a decrease of 0.80% compared to 2023, it is still significantly higher than the levels in 2021 and 2022.

In terms of stablecoin types, USDT on the Tron network has dominated from 2021 to 2024. However, in 2024, the shares of USDT and USDC on the Ethereum network have both increased.

The scale of online gambling continues to grow

In 2024, the funding scale of online gambling platforms and their payment service providers reached $217.8 billion, an increase of over 17.50% compared to 2023. Notably, the usage ratio of USDC in the online gambling sector significantly increased to 13.36%, far exceeding the 5.22% in 2023. This indicates that despite USDC being issued and regulated by compliant entities, its adoption in the online gambling sector has still increased substantially.

The scale of black and gray market transactions remains unchanged

In 2024, business addresses related to black and gray market transactions received over $278.1 billion in funds across the Ethereum and TRON networks, slightly higher than in 2023 and far exceeding the levels of 2021 and 2022. Crypto Assets collateral trading platforms play an important role in the development of the black and gray industries, providing collateral services for various links and establishing trust among criminals.

Crypto Assets fraud scale has surged sharply

In 2024, the scale of stablecoin received by blockchain addresses related to fraudulent activities experienced explosive growth, reaching $52.5 billion, surpassing the total of previous years. However, this astonishing growth may not be entirely accurate, as statistical methods and the increase in the level of fraud by illegal entities could affect the accuracy of the data.

The scale of money laundering begins to shrink

In 2024, blockchain addresses associated with money laundering activities received a total of $86.3 billion in stablecoins, slightly lower than in 2023 and on par with 2022. This may indicate that significant law enforcement activities and regulatory measures in recent years have effectively suppressed the money laundering crime situation in the Crypto Assets industry.

The on-chain freezing activities of stablecoins have significantly increased

In 2024, Tether and Circle froze over $1.3 billion worth of stablecoins on the Ethereum and TRON networks, doubling the scale of freezing in the previous three years. The trading volume of frozen addresses in that year reached $12.9 billion, roughly the same as in 2023, indicating that on-chain Crypto Assets criminal activities had already been active, but effective crackdowns did not begin until 2024.

Sanction Trends of OFAC and NBCTF

The funds associated with sanctioned entities related to the U.S. Office of Foreign Assets Control (OFAC) and Israel's National Bureau for Counter Terror Financing (NBCTF) reached a peak in blockchain addresses in 2022, and have declined year by year since then. However, these sanctions have had a limited impact on criminal groups utilizing encryption infrastructure for illegal activities.

Regulation Brings Positive Impact to Hong Kong

In 2024, the crypto industry will accelerate compliance. Taking Hong Kong as an example, its compliance policies have constructed a safer and more controllable crypto ecosystem through clear legal requirements, client fund protection, and measures to combat illegal activities. Data shows that after the third quarter of 2023, the proportion of risk stablecoins flowing into Hong Kong has sharply decreased, indicating that stablecoin transactions related to risk activities have been effectively suppressed.

Conclusion

2024 is a key year for the comprehensive revival of the crypto industry and for major economies to start facing the industry. Although the scale of crypto crime remains large, top-down compliance regulations and bottom-up industry self-discipline have brought positive impacts to the crypto industry in some countries or regions. The industry is moving towards a safer and more trustworthy direction.