According to a new report from the American blockchain analysis company, only 0.34% of cryptocurrency transactions were reportedly associated with illegal activities in 2023.
The latest Chainalysis report reveals that the majority of cryptocurrency transactions in 2023 were conducted for legitimate purposes, accounting for 99.6%.
According to the report, the total value of cryptocurrencies sent to addresses associated with illegal activities experienced a significant reduction, decreasing from $39.6 billion in 2022 to $24.2 billion in 2023. The 2022 figure included $8.7 billion in claims from FTX creditors following the exchange’s failure.
The data shows that illicit cryptocurrency transactions accounted for only 0.34% of the total cryptocurrency volume in 2023, down from 0.42% in 2022 and 1.3% in 2019.
While Bitcoin had been the primary cryptocurrency used by criminals until 2021, its share in illicit transactions has consistently decreased over the past five years. In its place, stablecoins, such as Tether, have emerged as prominent players for these types of transactions.
Comparison with the traditional financial sector
Crime associated with the cryptocurrency sector remains relatively small compared to illicit activities occurring in the traditional financial sector. The Global Financial Crime Report estimates that over $3.1 trillion of funds linked to illegal activities circulated in the global financial system in 2023, with $782.9 billion from drug trafficking, $346.7 billion from human trafficking, and $11.5 billion from terrorism financing.
CoinGecko’s 2023 report
A further report released by CoinGecko, a cryptocurrency data aggregator, has provided a global view of the cryptocurrency market for the year 2023. The report reveals a total increase in the value of the cryptocurrency market of 108.1% in the year under review, starting from an initial $829 billion to $1.72 trillion.
Highlights of the CoinGecko report:
- Bitcoin grew by +155.2% in 2023 with increasing confidence in spot ETF approval.
- Ethereum rose by 90.5% in 2023.
- Solana recorded an increase of +917.3% in 2023.
- The volume of NFT transactions decreased to 44% compared to 2022 data, standing at $11.8 billion in 2023.
- The volume of crypto transactions increased by 53.1% in the last quarter of 2023, reaching $10.3 trillion.
