A new report says that by 2020, the number of cryptocurrency-related crimes has decreased, but some sectors in the cryptocurrency industry have become new breeding grounds for criminal activity.

Referring to the large crypto analysis firm CipherTrace, Reuters reported on November 10 that total losses from theft, burglary and fraud decreased from $ 4.4 billion in 2019 to $ 1.8 billion in the first 10 months of 2020.

CipherTrace CEO Dave Jevans said the overall decline in criminal activity in the cryptocurrency industry is a result of increased security measures:

“We have seen that exchanges and other cryptocurrency operators have implemented many security measures […] They have adopted recommendations and implemented measures to better protect their funds. So you will see fewer massive hacks.
Despite the big drop in cryptocurrencies this year, CipherTrace reported a marked increase in hacker attacks in decentralized funding, or DeFi. Analysts at CipherTrace found that the DeFi hack was “practically insignificant” in 2019, but now accounts for 20% of the cryptocurrency’s loss from theft and piracy. “It was DeFi’s increase in popularity that ultimately attracted the criminal hackers, leading to the largest number of hacks this year,” the report said.

Jevans said that the DeFi industry has also become a “haven for money launderers”. Since DeFi projects are primarily unauthorized, they often lack central project security validation tools. Jevans stated:

“Companies and individuals rushed to the market using DeFi products that failed security screening and validation […] so people realize there is a weakness here.”
A recent analysis from CipherTrace confirms previous reports that the number of cryptocurrency hacks has decreased by 2020. In late October, VPN provider Atlas VPN published a study claiming that the number of blockchain-related hacks in the first half of 2020 fell more than three times compared to Same period in 2019.

Source: CoinTelegraph