June 7, 2020 3 min read


CipherTrace Predicts 2020 as Second Largest Year for Crypto Fraud

With $1.36 billion in assets already siphoned off by nefarious individuals and organizations, the pace of crypto frauds and lost funds continues to grow. According to CipherTrace, 2020 may prove just as dangerous to businesses and consumers as 2019 when $4.5 billion was lost to fraudulent activities.

CipherTrace Cautions that Crypto Frauds Continue to Intensify in 2020

A new report by CipherTrace, a digital-asset intelligence firm, has indicated that money siphoned off through cryptocurrency crimes has grown exponentially in the first five months of the year, topping $1.36 billion in estimated value, and placing 2020 as the second-largest year in the books.

Extrapolating with the findings of the report, ill-gotten funds this year may in fact amount to around $4.5 billion, the number set back in 2019. With many online businesses seeing an increase in their activity, criminals have also been quick to capitalize on COVID-19. They may have also had something with the Bitcoin crash earlier this year so far.

There has been a number of incursions released on unwitting consumers via ransomware, darknet frauds, and phishing attacks. There have been many different attempts to impersonate official authorities and request funding this way, with criminals sending emails “on behalf of” the Red Cross, Center for Disease Control and Prevent (CDC) and the World Health Organization (WHO).

The Need for Anti-Money Laundering Procedures Grows

One of the reasons why crypto frauds continue to happen is the lack of proper Anti-Money Laundering mechanisms. According Pawel Aleksander, a co-founder and chief information officer for CoinFirm, another intelligence company, the actual volume of crypto stolen is already $2 million in the first five months of the year, not $1.5 billion.

Aleksander spoke to CoinTelegraph, a leading publication that follows the crypto world closely. In his communication with CoinTelegraph, Aleksander argued how companies can best address the uptick in fraudulent activities. Aleksander said that proper AML procedures must be introduced first.

His exact words were that securing the crypto space would happen by “achieving a synergy between AML, fraud investigations and an open data ecosystem that takes the security of crypto financial markets to a level never seen before or even thought possible in traditional finance.”

Boosting AML is a particularly beneficial aspect of the industry that can reflect well on the crypto gambling industry as well. With blockchain casino touted as safer than any mainstream counterpart, establishing clear protocols for verifying players’ identity would be important in the future.

As the world tries to tackle crypto fraud, one by-product of that would be to make blockchain operators safer than ever before. In the meantime, there have been genuine charity initiatives launched by the crypto community, such as the tournaments by Binance and Bitcasino.io.


Jerome is a welcome new addition to the Gambling News team, bringing years of journalistic experience within the iGaming sector. His interest in the industry begun after he graduated from college where he played in regular local poker tournaments which eventually lead to exposure towards the growing popularity of online poker and casino rooms. Jerome now puts all the knowledge he's accrued to fuel his passion for journalism, providing our team with the latest scoops online.

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