According to the latest data from Chainalysis, the total value of cryptocurrency received by illicit addresses will grow to an all-time high of $14 billion in 2021. Although the new all-time high is nearly double the $7.8 billion recorded in 2020, it represents only 0.15% of cryptocurrency trading volume in 2021.

Percentage of funds sent to illicit addresses drops

The value of recorded cryptocurrency-related crimes in 2021 surged to an all-time high of $14 billion, a figure nearly double the $7.8 billion received by alleged illicit addresses in 2020. The latest Chainalysis data shows that the value of funds transferred to illicit addresses is still well below the average growth rate of the crypto economy.

in a recent blog postal Blockchain analysis firm Chainalysis broke down the cryptoeconomy’s $15.8 trillion transaction volume in 2021, asserting that the growth in the value of funds transferred to illicit addresses does not indicate that the space is now dominated by criminals. Instead, the growth could be a hint as to how far the crypto economy has expanded in 12 months.

To illustrate, the blog post noted a 567 percent increase in crypto trading volume, which the analytics firm linked to the growing popularity of cryptocurrencies. Chainalysis also made its point about the widening gap between the amount of illegal activity and the legal one:

In fact, with the growth of legitimate cryptocurrency usage far outpacing the growth of criminal usage, the share of illicit activity in cryptocurrency trading volume has never decreased.

Crypto crime hinders adoption

In support of its position that illicit activity is a declining share of cryptocurrency trading volume, Chainalysis pointed to data showing that crime-related addresses will only account for 0.15% of transactions in 2021. This figure is lower than the 0.62% recorded in 2020 and the 3.37% recorded in 2019.

While noting the low percentage of criminal crypto transfers relative to overall transaction volume, Chainalysis still admits that “criminal abuse of cryptocurrencies has created significant barriers to continued adoption.” The post argues that such abuses typically “increase In the worst case scenario, innocent people all over the world suffer.”

The blog post also shows that law enforcement agencies are getting better at fighting cryptocurrency-based crimes.it cites indictment U.S. Commodity Futures Trading Commission (CFTC) and OFAC Sanctions Two Russian-based cryptocurrency platforms.

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Terence Chimwala

Terence Zimwara is an award-winning journalist, author and author from Zimbabwe. He has written extensively on the economic woes of some African countries and how digital currencies can offer Africans an escape route.