Cryptocurrency Money Laundering Rose 30% In 2021: Report

Criminals laundered $8.6 billion U.S. of cryptocurrencies in 2021, up by 30% from the previous year, according to a new report by blockchain data company Chainalysis.

The company previously estimated that criminals received a record $14 billion U.S. in cryptocurrencies in 2021.

Chainalysis says it tracks cryptocurrency wallets controlled by criminals such as ransomware attackers, malware operators, scammers, human traffickers, dark net operators, and terrorist groups.

By following flows of cryptocurrency from addresses associated with criminal activity, Chainalysis was able to estimate the amount laundered. It says most cryptocurrency is laundered through a limited number of services - for example, particular exchanges favoured by criminals.

The report notes that “while billions of dollars' worth of cryptocurrency moves from illicit addresses every year, most of it ends up at a surprisingly small group of services, many of which appear purpose-built for money laundering.”

According to Chainalysis, the total amount of cryptocurrency laundered last year is short of the five-year peak of $10.9 billion U.S. reached in 2019.

However, the Chainalysis figures only cover crimes such as ransomware attacks where criminals are paid in cryptocurrency. Money from offline crime, such as cash from drug trafficking, converted into cryptocurrency to be laundered is not included, and this could be a growth area, the report suggests.