As global cryptocurrency adoption continues to surge, notably following the post-US election bull run, so does the rising tide of crypto crime. According to Chainalysis’ annual Crypto Crime report, illicit addresses received an alarming US$40.9 billion throughout 2024. This figure is expected to climb to US$51 billion as further criminal activity is uncovered in the ongoing analysis.
Despite this worrying trend, illicit activities still make up only a small fraction (0.14%) of the total on-chain transaction value, highlighting the continued growth of the larger crypto ecosystem. However, experts at Chainalysis have expressed concern over the increasing diversification and professionalization of cryptocrime.
Eric Jardine, Cybercrimes Research Lead at Chainalysis, commented, “An increasing number of illicit actors, including transnational organized crime groups, are exploiting cryptocurrency for various criminal activities, such as drug trafficking, gambling, intellectual property theft, money laundering, and even violent crimes. Notably, some criminal networks are engaging in ‘polycrime’—a practice of participating in multiple types of criminal activity.”
A significant portion of illicit transactions—US$10.8 billion in 2024—can be attributed to “illicit-actor organizations.” This category encompasses wallets linked to cybercriminals involved in hacking, extortion, trafficking, and scams, along with those offering services like laundering-as-a-service.
The UAE’s crypto landscape, which has rapidly advanced, has also seen a notable shift. Following the introduction of the Payment Token Services Regulation by the Central Bank of the UAE (CBUAE) in July 2024, Chainalysis has observed a consistent movement away from Bitcoin (BTC) in favor of stablecoins. These now account for 63% of illicit transaction volume, reflecting the growing dominance of stablecoins in the region. Stablecoins now make up the largest share of crypto activity in the UAE, at 51%, outpacing Bitcoin (19%) and Ether (9%).
Arushi Goel, Policy Lead for the Middle East and Africa at Chainalysis, emphasized the importance of vigilance in light of this shift. “With the approval of AE coin, the UAE’s first regulated, AED-pegged stablecoin, there is growing optimism among consumers about the benefits of these assets. However, the threat of crypto criminals stealing their investments could undermine this enthusiasm. To protect users and build trust in the UAE’s digital asset ecosystem, collaboration among VASPs, regulators, law enforcement, and other stakeholders is essential. This will help ensure that the UAE’s crypto innovation is safeguarded against evolving threats.”
As the crypto space continues to evolve, the challenges of cryptocrime are becoming more complex and widespread, demanding a unified response from all ecosystem stakeholders.