Crypto criminals, who steal funds from crypto enterprises through various means, are increasingly becoming the biggest hodlers for these currencies. Hodling is an industry term for users who hold large amounts of crypto without selling them, in hopes of future profits. The largest hodlers are called whales, who hold over $1 million worth of crypto in their wallets.
Crypto criminals now account for roughly 4% of all whales in the industry, according to a report by blockchain tracking firm Chainalysis. The company’s 2022 Crypto Crimes report said that cryptocurrency holdings among cyber criminals saw a massive surge in 2021, rising from around $3 billion in 2020 to over $11 billion in 2021.
In this, the biggest source of funds among criminals happen to be stolen funds, which contributed to $9.8 billion (or 83%) of all crypto holdings with criminals in 2021, the report said. The company identified these users as whales who received 10 to 25% of their crypto funds from illicit addresses, amounting to holdings of over $25 billion (~ ₹1.87 lakh crore) in crypto tokens.
Further, the report details how cryptocurrency crimes have been on a rampant rise through 2021, especially stolen funds. Multiple reports of funds stolen from decentralised finance (DeFi) platforms have surfaced, with information from crypto data tracker The Block showing a rise of over 20x year-on-year (YoY) in crypto funds stolen through DeFi platforms in October 2021. According to this, attackers exploited coding flaws in flash loans, or non-collateralised cryptocurrency loans, to steal funds.
In January 2022, blockchain security firm CertiK stated that stolen cryptocurrencies crossed $1 billion in 2021, led by coding discrepancies on DeFi platforms.
Read more on livemint.com