The drop in the price of bitcoin and other encrypted currencies did not stop the bad guys from making money last year, which valued for $ 1.7 billion. And these scams are not expected to decrease in 2019, despite efforts to crack down on the industry. CipherTrace, the crypto-security firm, has released its fourth-quarter anti-money laundering report (Cryptocurrency Anti-Money Laundering Report). It revealed that of the $ 1.7 billion stolen by hackers, more than $ 950 million came from cryptocurrency and infrastructure trades, an increase three times that of 2017. CipherTrace could detect it.
The actual number of cryptographic assets lost by hackers is probably much larger, the security company said in the report. According to CipherTrace, last year cybercriminals merged new techniques with proven methods to scam investors out of nearly $ 2 billion in cryptocurrency. Popular scams in 2018 that are expected to increase this year include exit scams offering initial coins, exchange hacks, and Ponzi schemes. Internal jobs have also resumed in 2018, with cybercriminals seeking investors and central users rather than stronger computer systems to prevent attacks. Korea and Japan caused the largest number of thefts and scams, with 58% in both countries last year. Cipher Trace also found that hackers were turning to cryptographic exchanges in the first three quarters of the year, while the last quarter of 2018 was more focused on insider jobs.
Whether it’s theft by hackers or internal cheats such as outgoing scams, criminals have to launder all those ill-gotten gains before they can spend those funds in the real economy. In addition, global gangs, terrorist groups, and cyber criminals have to hide their financial problems. These bad actors are clearly flowing into jurisdictions where LMA and KYC regimes are weak.
ICO’s Exits, The Worst Of the Lot
In the case of ICOs, David Jevans, most of the raised capital remained in the hands of the companies, some of them being simple scams and others still trying to build a blockchain project. or crypto. This year, many outgoing scams will collapse, investors will suffer. In many cases, they sit on money claiming to be legitimate projects. Many of them will leave when they realize they cannot build what they promised or because of some form of internal conflict. Many think it will be bigger than 2018. The good news is that the quality of registered ITOs has improved dramatically thanks to increased regulation. There will be fewer country offices in the future, but of better quality.
SIM Swaps On The Rise
A new generation cryptographic scam that surfaced last year and is expected to resume in 2019 is the exchange of SIM cards for the theft of digital tokens. This new threat to cryptography companies, users and investors involves a hacker transferring the victim’s phone number to a SIM card held by the criminal. With the number in hand, the hacker uses it to reset the phone’s passwords and access user accounts on crypto-encrypted exchanges. Once inside, they can clear the account. This scam is a success because it exploits a weakness of two-factor authentication – the second factor is a text or a call placed on the mobile phone. Big investors in cryptocurrency, have been warned as they are a growing target of this type of attack. According to the security firm at the beginning of last year, a hacker could have stolen $ 23.8 million with this tactic.
As the market grows in popularity and regulators grow stronger, the crypto-currency world would become more stable and less subject to fraud. Investors are going to witness huge improvements this year with the entry into force of the regulations. As security increases, larger players will enter more broadly, bringing stability and security to the market. There is also the increasing hope amongst investors for some form of formal recognition of crypto currencies by world economies.