An analytical data provider says the criminal crypto transactions volume exceeded 20 billion dollars in 2022.

Despite the market downturn, illicit transaction volume rose for the second consecutive year, hitting
an all-time high of $20.6 billion the end of last year. Of this, 43% of illicit transaction volume came from activities associated with sanctioned entities, says the 2023 Crypto Crime Report by Chainalysis, a blockchain data platform. 

Last year was one of the most tumultuous in cryptocurrency history, with several large firms imploding,
including Celsius, Three Arrows Capital, FTX, and others — some amid allegations of fraud, noted Chainalysis, which focused on illicit activity that can be measured on-chain while leaving the businesses under ongoing investigation outside the report.

By value, scams dropped from the first place to the second and fund thefts dropped from the second to third place.

Explaining why the sanctioned entities accounted for the largest volume of illicit transactions, Chainalysis said the Office of Foreign Assets Control (OFAC) - a financial intelligence and enforcement agency of the U.S.

Treasury Department that administers and enforces economic and trade sanctions in support of U.S. national security and foreign policy objectives - launched the most ambitious and hard-to-enforce sanctions yet.

“Crypto exchange Garantex, which accounted for the majority of sanctions-related transaction volume last year, is a great example. OFAC sanctioned Garantex in April 2022, but as a Russia-based business, the exchange has been able to continue operating with impunity. Transactions associated with Garantex or any other sanctioned crypto service represent, at the very least, substantial compliance risk for businesses that are subject to U.S. jurisdiction, including fines and potential criminal charges,” the report reads.

While the number of sanctioned entities in 2022 increased by 10% to ten compared with the previous year, the number of sanctioned addresses increased more than three-fold to some 360.

Overall, the share of all cryptocurrency activity associated with illicit activity has risen for the first
time since 2019, from 0.12% in 2021 to 0.24% in 2022.

The ten worst crypto offenders under sanctions include the Lazarus Group on top and Task Force Rusich on botton. Lazarus is a hacking and crypto theft organization working for the North Korean government and Rusich is behind warfare operations in Ukraine.

Money laundering the by far the most popular business among criminal wallet holders. The full report can be downloaded after registration here. 

Chainalysis provides data, software, services, and research to government agencies, exchanges, financial institutions, and insurance and cybersecurity companies in over 70 countries.