2025 Crypto Crime Report: The Alarming Rise of Cryptocurrency Crimes and What It Means for Investors

 

Cryptocurrency, once seen as a groundbreaking financial innovation, has unfortunately become a tool of choice for criminals, fueling a multi-billion dollar illicit industry. The 2025 Crypto Crime Report highlights just how pervasive and sophisticated these crimes have become.

As someone who’s dedicated countless hours to exposing Ponzi schemes and scams on my channel, the findings in this report are not surprising, but they are certainly alarming.

The rapid rise of crypto crimes, from ransomware and scams to market manipulation and stolen funds, is reshaping the landscape of digital finance.

A Massive Increase in Crypto Crime

According to the 2025 Crypto Crime Report, illicit cryptocurrency transactions in 2024 totaled $40.9 billion, marking a significant increase in crypto-related crime. This figure represents a drop from the previous year, but the report estimates that this is due to incomplete data, as more illicit addresses will be identified over time. In 2023, the estimated total was $46.1 billion, and given the rapid growth in illicit crypto activity, it’s likely that 2024’s total will surpass the $51 billion threshold when all the data is accounted for.

While these numbers might sound astronomical, they’re only part of the story. The report reveals a sharp increase in the diversification of crypto crime. It’s no longer just about simple scams or hacking operations. Criminals are now using cryptocurrency for all types of illegal activities, from drug trafficking to money laundering and even funding violent crimes.

The Growing Role of Stablecoins and Privacy Coins

A major trend identified in the report is the increasing use of stablecoins in illicit activities. Stablecoins now make up 63% of all illicit cryptocurrency transactions, a significant rise from previous years. This is not surprising, considering their perceived stability and ease of use for criminals. Stablecoins, such as Tether (USDT), are now being used for money laundering, scams, and ransomware payments. These coins allow criminals to move funds with a certain level of security, making it more difficult for authorities to track their movements.

At the same time, privacy coins like Monero (XMR) are becoming more popular in darknet markets and illicit transactions. These coins offer a high level of anonymity, making it even harder for law enforcement to trace criminal activity. This trend is troubling, as it makes cryptocurrency a more attractive tool for organized crime.

Scams: The Ever-Expanding Threat

Scams continue to be one of the largest categories of crypto crime, with at least $9.9 billion attributed to scams in 2024. This represents a slight decrease from previous years, but as the report notes, these numbers are likely to rise as more scam-related addresses are identified. The rise of high-yield investment scams and pig butchering frauds are particularly concerning. These types of scams target victims with promises of quick returns, only to rob them of their money once they’ve invested.

One of the most disturbing findings in the report is the increasing use of artificial intelligence (AI) in scams. Fraudsters are now using AI tools to create highly personalized scams that are more convincing and harder to detect. For example, AI is being used in sextortion scams, where victims are manipulated into paying large sums under the threat of compromising material. This is a direct evolution of the traditional fraud schemes, and it highlights how technology is being leveraged to exploit people’s vulnerabilities.

Ransomware: A Continuing Menace

Ransomware attacks remain a significant threat to businesses and individuals alike. In 2024, ransomware attackers received $813.55 million in payments, a 35% decrease from 2023. While this drop is encouraging, it’s important to remember that these attacks continue to be a serious issue. The decline in payments is largely attributed to increased law enforcement action and a growing reluctance among victims to pay the ransom.

However, ransomware is evolving. Groups are shifting their tactics, and some have even begun using ransomware-as-a-service (RaaS) platforms. These services allow smaller criminals to launch ransomware attacks without needing the technical expertise that was once required. This has led to an increase in the number of ransomware attacks, even if the overall payment amounts have declined. The report also points to the continued use of cross-chain bridges by ransomware groups to launder their stolen funds, further complicating law enforcement efforts.

Darknet Markets: Still a Major Source of Illicit Activity

Despite law enforcement’s efforts to disrupt darknet markets (DNMs), these illegal platforms continue to thrive. In 2024, DNMs received over $2 billion in cryptocurrency transactions, a decrease from previous years but still a significant figure. The decline in DNM revenue is largely attributed to the disruption of major platforms like Hydra and Mega, which were targeted by international authorities. However, smaller DNMs are now rising to fill the void.

One of the key takeaways from the report is the growing shift from Bitcoin (BTC) to privacy coins and stablecoins in darknet markets. Criminals are increasingly using privacy coins like Monero to evade detection, and stablecoins provide a stable means of conducting transactions with minimal scrutiny. This trend makes it harder for law enforcement to track illicit transactions and highlights the growing challenge of policing crypto crime.

Market Manipulation: Pump-and-Dump Schemes

Market manipulation remains a major issue in the cryptocurrency space, and the report highlights wash trading and pump-and-dump schemes as the most common forms of manipulation. Wash trading involves artificially inflating the trading volume of a cryptocurrency by repeatedly buying and selling the same asset. This creates a misleading perception of demand, which can deceive investors into making ill-advised purchases.

In addition, pump-and-dump schemes are still prevalent, with scammers driving up the price of a cryptocurrency through coordinated hype on social media, only to sell off their holdings when the price peaks. Once the price crashes, unsuspecting investors are left holding the bag. The report estimates that 3.59% of all tokens launched in 2024 showed signs of being involved in pump-and-dump schemes. This represents a significant risk for retail investors who may be unaware of the manipulation taking place behind the scenes.

The Professionalization of Crypto Crime

One of the most concerning aspects of the 2025 Crypto Crime Report is the increasing professionalization of crypto-related crimes. Criminals are no longer just individuals operating on their own. Large, transnational criminal organizations are now using cryptocurrency to fund their illegal activities. These organizations have become highly organized, with a broad array of tools at their disposal to launder stolen funds, facilitate drug trafficking, and even conduct violent crimes.

A prime example of this is Huione, a platform that has processed over $70 billion in illicit crypto transactions since 2021. This platform provides a full suite of services for criminals, from laundering stolen funds to facilitating scams and ransomware payments. The growing sophistication of these operations underscores the need for continued law enforcement action and international cooperation.

Law Enforcement’s Ongoing Struggle

Despite the growing challenges, law enforcement agencies are making progress in their fight against crypto crime. In 2024, several high-profile takedowns disrupted major criminal operations, including ransomware groups, fraud shops, and darknet markets. These disruptions have had an impact, forcing criminals to adapt and shift their operations to more obscure platforms.

However, as the report notes, the growing complexity of crypto crime means that law enforcement must continue to innovate and improve their detection methods. The transparency of blockchain technology provides law enforcement with new tools to trace illicit transactions, but criminals are becoming increasingly adept at hiding their tracks using privacy coins, cross-chain bridges, and sophisticated laundering services.

Conclusion: What This Means for Investors

The 2025 Crypto Crime Report paints a stark picture of the growing threat posed by cryptocurrency to investors and businesses. As cryptocurrency continues to evolve, so too does the criminal ecosystem surrounding it. The report highlights the need for continued vigilance and collaboration between law enforcement, regulators, and the crypto community to address these emerging threats.

For everyday investors, the message is clear: the crypto space is rife with risks, and scams, market manipulation, and ransomware attacks are becoming more sophisticated. It’s crucial to stay informed and take steps to protect yourself from falling victim to these crimes. As I continue to expose these scams and help raise awareness, I hope this report serves as a wake-up call for anyone involved in cryptocurrency.