Cryptocurrency Scams Surge in 2024: Billions in New Inflows Reported

Cryptocurrency scams are on the rise in 2024, with billions of dollars in inflows, according to new research by blockchain data company Chainalysis. The report reveals that 43% of the total year-to-date (YTD) scam inflows have gone to wallets that only became active this year, indicating a surge in new scams. This is a significant increase compared to 2022, when only 29.9% of YTD flows went to newly active wallets.

Chainalysis also highlights a sharp decline in the average lifespan of scams between 2020 and 2024. Scams that began in 2020 were active for an average of 271 days, while those starting in 2024 have only lasted an average of 42 days. This trend suggests a shift away from elaborate Ponzi schemes towards more targeted scams, such as romance scams and address poisoning.

Eric Jardine, Cybercrime Research Lead at Chainalysis, explained, “Scammers are pivoting to more targeted campaigns, making them harder to track and complicating victim restitution. It’s crucial for individuals to remain vigilant, especially when receiving unexpected communications that request monetary transfers.”

In its 2024 Crypto Crime Report, Chainalysis noted that romance scams, also known as “pig butchering scams,” have had the worst impact on victims in terms of average payment size. The data shows that this type of scam activity has grown 85-fold since 2020. Between 2022 and 2024, a single fraud shop involved in these scams received $10.5 million from scammers, selling social media profiles that could be used to target victims.

Jardine added, “While targeted scams like romance scams may seem unlikely to happen to any individual, it’s important to stay on guard. The transparency of blockchains has been a powerful tool in uncovering these scams, and Chainalysis remains committed to collaborating with law enforcement and cryptocurrency exchanges to prevent and disrupt illicit activities.”

Chainalysis continues to monitor the crypto crime ecosystem and work with partners to protect against these growing threats.