Chainalysis, a blockchain-based data analytical platform, has identified 4,068 criminal whales holding over $25 billion worth of cryptocurrency. The criminal whales represent around 3.7% of all cryptocurrency whales – private wallets holding over $1 million worth of cryptocurrency that has received more than 10% of its funds from illicit addresses. It should be noted that criminal whale balances are calculated based on private wallet holdings.
The report highlighted that most criminal whales received either a relatively small or extremely large share of their total balance from illicit addresses. The criminal whales are grouped by the share of their total cryptocurrency received from illicit addresses. 1,374 criminal whales, grouped in the lowest-share but the biggest, received between 10% and 25% of their total balance from illicit addresses, while the largest-share was made up with 1,361 criminal whales having received 90% to 100% funds.
It should be noted that illicit funds come from varied sources than the funds making up the overall criminal balance. Stolen funds dominate overall criminal balances with darknet markets being the biggest source of illicit funds. This is followed by scams and stolen funds.
In regards to illicit transaction activity, the report states that criminal addresses had received more than $14 billion in 2021. This marked a whopping 79% increase against the $7.8 million recorded in 2020. The $14 billion figure, that is the lion’s share, in 2021 was attributed to scamming which surged by 82% year-over-year to account for $7.8 billion. DeFi rug pulls were seen as a key source of scamming at $2.8 billion.
The report said 90% of the total value lost to rug pulls in 2021 is given to Thodex – a fraudulent centralized exchange. It highlighted a 516% spike in theft, accounting for $3.2 billion worth of illicit transaction activity. The DeFi sector, once again, came to light as an area of concern.