Bitcoin whales: Crypto criminals are now among the biggest holders of cryptocurrencies, report says


Crypto whales are investors holding $1 million or more in cryptocurrency. A total of 4,068 criminal whales holding over $25 billion worth of cryptocurrency have been identified.

Crypto criminals or criminal entities and individuals holding cryptocurrencies are now some of the largest holders of cryptocurrencies in the world. In fact, these crypto criminals accounted for 3.7% of all crypto whales in 2021, according to a Crypto Crime Report by Chainalysis. Crypto whales are investors holding $1 million or more in cryptocurrency. Overall, 4,068 criminal whales were identified in the report holding over $25 billion worth of cryptocurrency.

Most criminal whales have received a relatively small or extremely large share of their total illicit address balance. The lowest share bucket was the largest with 1,374 criminal whales receiving 10-25% of their total illicit address balance. The largest bucket followed closely with 1,361 criminal whales who received 90-100% of their total illicit address balance.

Additionally, the report showed that the amount of crypto held by crypto criminals, also referred to as criminal balances in the report, jumped nearly 4x from $3 billion in 2020 to $11 billion in 2021. This was dominated by stolen funds. At the end of 2021, stolen funds accounted for 93% of all criminal balances, or $9.8 billion. Darknet Market funds were next at $448 million, followed by Scams at $192 million, Fraud Shops at $66 million, and Ransomware at $30 million.

Also Read: Bitcoin Critic Warren Buffett Invests $1 Billion in Neobank That Provides Crypto-Related Services

Using the blockchain infrastructure, criminals involved in crypto-based crime can be tracked more effectively while their assets can be quantified from a public data set against fiat-based crime, according to the report. “In fiat, the wealthiest criminals have shadowy networks of foreign banks and shell companies to hide their assets. But in cryptocurrency, transactions are recorded on the blockchain for everyone to see. This allows government agencies around the world to seize crypto from criminals and bring them to justice, Chainalysis said.

Growth in illicit activity in the crypto market and increase in crypto crime cases were highest in 2021, even as investors continued to bet on cryptocurrencies. Crypto laundering in 2021 jumped 30% to $8.6 billion, the second highest in five years, from $6.6 billion in 2020 and $10.9 billion in 2019.

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