As crypto cases involving multiple blockchains on the rise, blockchain analytics firm Elliptic reveals that 20% of complex cross-chain investigations now span over 10 different blockchains.
A full 20% of complex cross-chain investigations now span more than 10 different blockchains, according to new data from blockchain analytics firm Elliptic.
Crypto crime, also known as cryptocurrency-related crime, refers to illicit activities involving digital currencies.
According to a report by Chainalysis, crypto crime has increased significantly since 2017, with over $1 billion lost in 2020 alone.
The most common types of crypto crimes include hacking, phishing, and Ponzi schemes.
As the use of cryptocurrencies grows, so does the risk of falling victim to these crimes.
Crypto criminals are increasingly using multiple blockchain ecosystems to evade detection. This tactic is becoming more prevalent due to the decreasing cost of switching between ecosystems and the increasing number of options available. Jackson Hull, Elliptic’s chief technology officer, notes that cross-chain crime has existed as long as there have been multiple blockchains, but the volume of cross-chain crime has increased ‘pretty dramatically‘ over the last five years.
A third of complex cross-chain investigations involve four or more blockchains, while 27% involve more than five. These complex investigations are often used by hackers and other criminals to launder money and cover their tracks. Elliptic’s software is able to trace funds that move between any of the covered blockchains, or pass through any of the ‘300-plus‘ bridges supported.
Cross-chain crime refers to illicit activities that occur between two or more blockchain networks.
This can include hacking, phishing, and other forms of cyber attacks.
According to a report by Chainalysis, cross-chain crime increased by 41% in 2022 compared to the previous year.
The rise of decentralized finance (DeFi) has made it easier for hackers to exploit vulnerabilities across different chains.
As a result, cross-chain security measures are becoming increasingly important to prevent losses and maintain trust in blockchain networks.
Elliptic has expanded its coverage to support 50 blockchains, making it easier for investigators to track funds across ecosystems. This expansion has aided in law enforcement actions such as the takedown of sanctioned Russian crypto exchange Garantex. According to Hull, the most important and high-stakes investigations involve cases where the bad actor is trying to launder or hide funds.
The increasing complexity of cross-chain investigations poses a significant challenge for law enforcement agencies. However, with the help of blockchain analytics firms like Elliptic, investigators can now more effectively track and disrupt cross-chain crime. As Hull notes, this is particularly important in cases where the bad actor is trying to launder or hide funds.
Blockchain analytics involves analyzing data stored on a blockchain, providing insights into network activity, transaction patterns, and smart contract performance.
This field has gained significance due to its ability to enhance security, transparency, and efficiency in various industries such as finance, supply chain management, and healthcare.
Blockchain analytics tools utilize complex algorithms to extract valuable information from the blockchain, enabling organizations to make data-driven decisions.
By leveraging 'blockchain analytics' , companies can identify potential risks, optimize processes, and gain a competitive edge.
As the number of blockchains continues to grow, it’s likely that cross-chain investigations will become even more complex. However, with the support of blockchain analytics firms like Elliptic, law enforcement agencies can now better equipped to track and disrupt these investigations. By staying ahead of the curve, investigators can help keep the crypto ecosystem safe from those who would seek to exploit it.
