Cryptocurrency analysis firm Elliptic has revealed that a record $7 billion was laundered through cross-chain crime, a method that involves quickly swapping cryptocurrencies between different tokens or blockchains to disguise their criminal origin.
Also known as “chain” or “asset bypassing,” this method is becoming a dominant means of laundering crypto assets.
The latest “State of Cross-Chain Crime” report by Elliptic shows that cross-chain crime is fast becoming the money laundering method of choice for a range of cybercrimes, including fraud and crypto thefts. This comes as criminal sanctions continue to target traditional means of concealing funds.
The new research comes a year after Elliptic's first “State of Cross-Chain Crime” report, which revealed $4.1 billion in illicit or high-risk funds were laundered through decentralized exchanges (DEXs), cross-chain bridges and coin exchange services.
At that time, it was estimated that this figure would increase to 6.5 billion dollars by the end of 2023 and to 10.5 billion dollars by 2025. However, the latest figure of $7 billion shows that cross-chain crime is increasing faster than expected.
There are several reasons why cross-chain crime is on the rise. First, cryptoassets other than Bitcoin are becoming increasingly popular among criminals for their features such as anonymity (privacy coins like Monero) or price stability due to being pegged to government-backed currencies (stablecoins like Tether (USDT) or DAI).
The biggest increase in cross-chain crimes is seen in the area of crypto thefts, scams, pyramid schemes and illegal laundering committed by North Korea's Lazarus Group. This major cybercriminal organization alone is responsible for approximately 1/7 of all cross-chain crimes tracked by Elliptic and has laundered over $900 million through these methods.
*This is not investment advice.
