Along with the rise in popularity of cryptocurrency trading worldwide, there has been a significant increase in the number of crypto scams or frauds. In the UK alone, there have been 34,305 allegations of criminal behavior involving cryptocurrencies since 2016.
Cybercrime is now a widespread issue on a global scale. The amount of criminality involving cryptocurrencies peaked in 2021. According to a Chainalysis analysis, a blockchain data company, criminals laundered $8.6 billion in cryptocurrencies in 2021, an increase of 30% from the year before.
Related reading | Indian Regulator Gets Rid Of Its Only Crypto Exchange Body – Bane Or Boon?
Since 2017, hackers have laundered nearly $33 billion in cryptocurrencies, with the majority of that amount eventually migrating to centralized exchanges. In contrast, the UN Office on Drugs and Crime calculates that up to 5% of the world’s GDP—or between $800 billion and $2 trillion—of fiat cash is laundered annually.
Nonetheless, where money is concerned, scams always follow. As a result, investors and traders will need to pay much closer attention to their trading as authorities from all over the world get numerous reports of fraud and scams involving cryptocurrency every day.
The United Kingdom is now ranked number 5 due to the massive hacking and fraud scams carried out within its borders. However, North Korea is at the top of the list for crypto criminality worldwide.
The UK is a global hub for cryptocurrency frauds because of its lax corporate regulations, which make it simple for fraudsters to conceal the source of money and its intended destination. Therefore, the country has a long history of cryptocurrency fraud.
Reports Of Crypto Scam In The UK From 2016
By 2020, there were 8,801 documented crypto crimes, a staggering increase of 1,150% from the only 704 that had been reported in 2016. After that, in 2021, another surge was observed. In that year, 9,458 instances of cryptocurrency crime were recorded. Again, it was a 1,243% rise over the reported data for 2016.
In addition, the victims of cryptocurrency crime in the UK lost a staggering amount of money in just one year in 2021—more than £204 million.
Related reading | Bitcoin Purchasing App Now Functional On 175,000 ATMs Across United States
In the first month of 2021, there were 671 reports, and the claimed losses totaled £13 million. April saw the highest number of reports at 906. November witnessed the most significant financial losses of £23 million across 793 cases. The loss for the entire calendar year was £204.5 million.
Furthermore, the younger generations tend to become victims of crypto scams more than older people do. As it turns out, 12.3% of all casualties in 2021 were people aged 18-25 years old! Additionally, men are heavier targets for crypto crime than women are.
Featured image from Flickr, chart from Tradingview.com
