Encryption Crime Situation Analysis: 2024 Industry Status and Future Outlook

The year 2024 is a milestone year for the Web3 industry. The market capitalization of cryptocurrencies and the adoption of industry infrastructure have both reached unprecedented heights, but at the same time, criminals have begun to increasingly leverage encryption infrastructure to optimize their operations or create new criminal models. This article will conduct a statistical analysis of the scale of major encryption crime types and explore the impact of compliance measures on the scale of the criminal industry.

The situation of cryptocurrency crime remains severe

In 2024, the total receipt scale of high-risk addresses reached $649 billion, slightly higher than the previous year. These high-risk activities accounted for 5.14% of the total trading activities of stablecoins for the year, a decrease of 0.80% compared to 2023, but still significantly higher than in 2021 and 2022. In terms of stablecoin types, from 2021 to 2024, USDT on the TRON network has maintained the largest share. However, in 2024, the shares of USDT and USDC on the Ethereum network both increased.

The scale of online gambling continues to grow

In 2024, the funding scale of online gambling platforms and their related payment platforms reached $217.8 billion, an increase of over 17.50% compared to 2023. Notably, the usage proportion of USDC in the online gambling sector significantly increased to 13.36%, far exceeding 5.22% in 2023. This indicates that as USDC's market share grows, its adoption in the online gambling field has also risen substantially.

The scale of black and gray market transactions remains unchanged

In 2024, the Ethereum network and the TRON network received over $278.1 billion in funds related to black and gray market transactions, slightly higher than in 2023, while the transaction volume in these two years far surpasses that of 2021 and 2022. It is noteworthy that encryption currency escrow trading platforms play a significant role in the black and gray industries, facilitating trust among criminals.

Encryption fraud scale has surged dramatically

In 2024, the scale of stablecoin transactions related to fraudulent blockchain addresses saw explosive growth, reaching $52.5 billion, surpassing the total of previous years. However, this data may not be entirely accurate, as statistical methods and the advancement of fraudulent tactics by illegal entities may result in some cases being excluded from the statistics.

The scale of money laundering begins to shrink

In 2024, blockchain addresses associated with money laundering activities have received a total of $86.3 billion worth of stablecoins, slightly lower than in 2023, and on par with 2022. This may indicate that recent law enforcement activities and regulatory measures have effectively curbed the money laundering crime situation in the encryption industry.

The on-chain freezing activities of stablecoins have significantly increased

In 2024, stablecoin issuers actively cooperated with law enforcement actions. Tether and Circle froze more than $1.3 billion worth of stablecoins on the Ethereum and Tron networks, which is double the amount frozen in the previous three years. This indicates that while on-chain encryption criminal activities have long been active, they only began to be effectively targeted in 2024.

Regulation Brings Positive Impact to Hong Kong

In 2024, the attitude of regulatory agencies towards encryption globally shifted from a wait-and-see approach to more active intervention. Taking Hong Kong as an example, its compliance policies have constructed a safer and more controllable encryption ecosystem through clear legal requirements, customer fund protection, and other measures. Data shows that after the third quarter of 2023, the proportion of risk stablecoins flowing into Hong Kong has sharply decreased, indicating that local trading of stablecoins related to risk activities has been effectively suppressed.

Conclusion

Despite the large scale of encryption crime in 2024, top-down compliance regulatory policies and bottom-up industry self-discipline have already brought positive effects to the encryption industry in certain regions. With the improvement of the regulatory framework and the strengthening of industry self-discipline, the encryption industry is expected to usher in a safer and more trustworthy future.