Data from TRM Labs indicates that in 2023, illicit cryptocurrency transactions decreased by a third, dropping from $49.5 billion in 2022 to $34.8 billion. However, concerning crypto frauds in 2023, the TRON blockchain witnessed a significant increase, hosting 45% of such activities, up from 41% in the previous year.
A fresh report from TRM’s blockchain intelligence team sheds light on the prevalent trends in illicit cryptocurrency transactions throughout 2023.
Despite a 9% decline in the total value of illicit crypto funds from 2022 to 2023, criminals managed to handle over $34 billion worth of cryptocurrencies.
Titled “The Illicit Crypto Economy,” the report highlights that nearly half of all illicit crypto volume in 2023 (45%) occurred on the TRON blockchain, followed by Ethereum with 24% and Bitcoin with 18%.
Additionally, the Tether (USDT) stablecoin accounted for the largest illicit volume last year, totaling $19.3 billion. The report highlighted that “Approximately 1.63% of Tether volume was linked by TRM to illicit activity, compared to 0.05% of USDC.”
Angela Ang, a senior policy advisor at TRM, shared insights on why the TRON blockchain might attract perpetrators. She stated to Cryptonews, “One of the reasons for TRON’s popularity could be its low transaction fees and high speed.” According to Ang, these factors make it inexpensive and fast to launder funds.
She further explained, “The availability of stablecoins like USDT on TRON could be another factor. For example, we know that USDT on TRON is the currency of choice for terrorist financing entities.”
2023 Observed Crypto Crime Reductions
Despite the significant damage witnessed on the TRON blockchain, 2023 marked a notable decline in the volume of illicit funds, with a 30% decrease compared to the $49.5 billion recorded in 2022.
The report also highlighted that sanctions volume played a pivotal role in driving this overall decline last year. The value of crypto linked to sanctioned entities dropped by 30%, falling from $25.4 billion in 2022 to $16.2 billion in 2023.
Furthermore, there was a dramatic 50% reduction in crypto hacks and exploits, amounting to $1.8 billion in 2023 compared to $3.7 billion in 2022. The report noted that on average, each hack in 2023 compromised $10 million, contrasting with $21 million in 2022.
The report suggested that various factors likely contributed to the decrease in crypto crime in 2023, including increased vigilance from businesses, heightened fraud awareness among the general public, and chance occurrences.
