Recent reports reveal the extent of cross-chain crypto crime and losses from crypto hacks and alleged fraud incidents
Two crypto-related reports from the Elliptic researchers Eray Arda Akartuna and Thibaud Madelin and Immunefi revealed the impact of fraud and illegal laundering activities on the crypto market.
Firstly, the Elliptic report analyzed “the new frontier of crypto laundering.” The researchers noted the free flow of capital between crypto assets got enhanced due to the emergence of new technologies such as crypto bridges and DEXs. At the same time, cybercriminals have been using cross-chain bridges, DEXs and coin swaps to launder at least $4 billion worth of illicit crypto proceeds since the beginning of 2020.
Around one-third of the stolen crypto (roughly $1.2 billion) was swapped using decentralized exchanges. The two most often used DEXs were Curve and Uniswap, while the 1inch aggregator protocol took third place.
Another $1.2 billion has been laundered using coin swap services. Many of them were advertised on Russian cybercrime forums and catered almost exclusively to a criminal audience. Moreover, sanctioned entities from Russia and North Korea are increasingly turning to such technologies to move funds and carry out cyber-attacks.
Meanwhile, Immunefi estimated that crypto losses from hacks and alleged fraud incidents like rug pulls equalled over $428 million in Q3, down 36% from Q2 and 62.9% from Q3 2022. Most of those losses (80%) derived from two specific incidents involving the cross-chain messaging protocol Nomad and crypto market maker Wintermute. They led to losses of $190 million and $160 million, respectively.
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