2019 was a big year for Bitcoin scams

Cryptocurrency is gaining wider acceptance, but that’s not always a good thing.


January 29, 2020

Bitcoin is still a fringe currency, but it’s catching on in a crime-infested corner of the internet, The New York Times reports.

This week, the crypto-crime watchers Chainalysis found that the total amount of sales on “darknet” markets (the sketchy parts of the web) grew 70% last year, to more than $790m worth of crypto-cash.

Bitcoin is gaining wider acceptance — but more people are getting ripped off

  • One poll found that 8 in 10 American adults were familiar with at least one type of crypto.
  • 18% of them said they had purchased a form of cryptocurrency in the last year. Among millennials, that percentage nearly doubled, to 35%

Illicit transactions make up a tiny fraction of all crypto flow: just 1.1%. Still:

  • That 1.1% is more than double the rate of illicit transactions on the market in 2018.
  • 3 huge Ponzi scams were responsible for most of that activity.

The Chainalysis report says 3 threads tie all this sketchy activity together:

  • Crypto crime looks a lot like white-collar crime. It typically involves a small network of powerful hackers.
  • Most crimes involve money laundering. Because the bad guys have to convert their crypto to cash somehow.

Scams are the biggest threat. Think you’ll strike gold buying Bitcoin? You might just be a sucker.

Daily briefings, straight to your inbox

Business and tech news in 5 minutes or less

Join over 1 million people who read The Hustle

Psst

How'd Bezos build a billion dollar empire?

In 1994, Jeff Bezos discovered a shocking stat: Internet usage grew 2,300% per year.

Data shows where markets are headed.

And that’s why we built Trends — to show you up-and-coming market opportunities about to explode. Interested?

Join us, it's free.

Look, you came to this site because you saw something cool. But here’s the deal. This site is actually a daily email that covers the important news in business, tech, and culture.

So, if you like what you’re reading, give the email a try.