Illicit Crypto Inflows from Japanese Exchanges Drop in H1 2024: Chainalysis

Crypto inflows linked to scams on Japanese exchanges have dropped substantially in the first half of 2024, according to a report by Chainalysis.

Ethereum (ETH) inflows tied to fraudulent activities fell by 69%, while Bitcoin (BTC) inflows saw a nearly 50% reduction compared to the previous year.

Japanese Exchanges Record Decline in Scam-Linked Crypto Transactions

In 2023, Japanese exchanges facilitated $44.6 million in ETH and $11 million in BTC inflows linked to scams.

By mid-2024, these figures dropped to $13.7 million and $5.7 million, respectively, highlighting a notable improvement.

Fraudulent activities unrelated to crypto-native scams, such as phishing and romance fraud, were also substantially reduced.

ETH inflows linked to scams fell to just $1,171, while BTC fraud-related inflows halved to $18.8 million.

While these declines signal progress for Japanese exchanges, scammers have adapted by employing advanced methods.

Chainalysis noted that illicit funds are increasingly funneled through consolidation wallets and decentralized exchanges (DEXs), often converted into stablecoins like Tether (USDT).

“Considering the rapid pace at which money launderers use new wallet addresses, it’s not easy to track them all individually in real-time,” Chainalysis explained.

“However, identifying common consolidation points offers valuable insights into the magnitude of these activities,” they added.

Short-lived scams have also become more prevalent, with their average lifespan dropping from 271 days in 2020 to just 42 days in 2024.

Such developments reveal how fraudsters adjust their tactics, integrating online and offline schemes to target individuals effectively.

Rise of Phishing and Hacking Attacks Globally

Beyond scam-linked inflows, other forms of fraud have grown more sophisticated.

Blockchain security firm CertiK reported that phishing scams accounted for $293 million in total losses in 2024, making them the most financially damaging form of fraud this year.

These attacks exploit both human vulnerabilities and technological loopholes to extract funds.

Hacking incidents worldwide also increased by 2.8% in the first half of 2024, raising the total value of stolen cryptocurrencies to $1.58 billion—an 84% increase compared to the same period in 2023.

Exchanges remain a prime target for hackers due to their large transaction volumes. Japan, while seeing progress on scam inflows, continues to face high-profile threats.

The infamous Mt. Gox hack in 2011, leading to its closure in 2014, stands as a pivotal warning for the cryptocurrency industry.

The reduction in scam-linked inflows on Japanese exchanges reflects their ongoing efforts to combat fraud.

However, the rise of global phishing and hacking incidents highlights the ever-present risks in the cryptocurrency sector.

While progress is being made, the adaptability of scammers and hackers calls for continuous vigilance and innovation in security practices.

The post Illicit Crypto Inflows from Japanese Exchanges Drop in H1 2024: Chainalysis appeared first on Cryptonews.

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[Source: CryptoNews]