Report Highlights Moscow as Hotspot for Global Crypto Crime

Report Highlights Moscow as Hotspot for Global Crypto Crime

Cryptocurrency popularity has been growing massively in Russia, making it one of the top countries in the race to crypto adoption. While the country is yet to reach the top of the list, it appears that Russia has managed to top a different list altogether. As it turns out, it seems to have a disproportionate share of global criminal activity that involves cryptocurrency in one way or the other. The Global Crypto Adoption Index put together by Chainalysis reveals that Russia has managed to be in the list of top 20 countries. However, groups and individuals based in the country can also be linked to ransomeware revenue denominated in cryptocurrencies worth $400 million in 2021.

These statistics were disclosed this week by the blockchain analytics company known as Chainalysis. The company gave a preview of its 2022 Crypto Crime Report and said that almost 74% of the total ransomware revenue that had been generated last year had belonged to strains that were mostly likely affiliated with Russia. It was further alleged by the US-based company that most of the extorted funds are laundered via the platforms that operate in the Russian crypto market and it cited web traffic data to support its claim.

Almost 13% of the funds that had been sent to service providers from ransomware addresses had gone to users who are believed to be based in Russia. The authors of the report noted that these crypto laundering activities are far greater than those conducted in other regions. Chainalysis has stated in the report that a large number of crypto businesses that facilitate money laundering activities either operate in or out of, or have their headquarters in the financial district of the Russian capital i.e. Moscow City. A number of those are believed to have processed a substantial number of transactions that had come from addressed linked to criminal activities.

This also includes cryptocurrency broker Suex, which had been blacklisted last year in September by the US Treasury Department’s Office of Foreign Assets Control (OFAC). Offices of the platform are based in St. Petersburg and Moscow and it is suspected of processing crypto transactions worth hundreds of millions of dollars that are related to scams, darknet markets, ransomware attacks and the renowned BTC-e exchange. Chainalysis disclosed that in the three years of study, they had found that these businesses had received cryptocurrencies from these illicit addresses worth $700 million.

This is about 13% of the total funds that had been sent to these platforms and their trading volume had reached an all-time high in the second quarter of 2021 of about $1.2 billion. The report also highlighted that darknet market accounts and scams are responsible for most of the illicit cryptocurrency that was transferred to companies based in Moscow between 2019 and 2021. These were valued at $296 million and $313 million, respectively. With $38 million, the third spot goes to ransomware companies. These figures were published after the law enforcement in Russia had recently taken action against cybercriminals using cryptocurrencies.