Chainalysis Warns: Illicit Cryptocurrency Volume Could Reach $51 Billion in 2024 Despite Overall Decline

A recent report from Chainalysis estimates that illicit cryptocurrency volume could rise to $51 billion in 2024 as more addresses related to criminal activities are uncovered. However, this potential increase comes at a time when the proportion of illicit use in the cryptocurrency market has fallen to its lowest level in three years.

A Disturbing Landscape: Crime and Cryptocurrency

Illicit cryptocurrency volume hit nearly $41 billion in 2023, with projections for an additional $10 billion this year based on historical trends and the identification of new illicit addresses. “2024 is likely to be a record year for illicit actors’ revenues,” Chainalysis stated in a blog post on January 15.

Despite the resurgence of the cryptocurrency market, which surpassed $3.9 trillion in mid-December 2024 due to the approval of ETFs and the election of Donald Trump, the illicit volume fell to just 0.14%, down from 0.61% in 2023, marking the lowest level since 2021.

Shifts in Cryptocurrency Use for Crime

Chainalysis highlights an increasing trend of transnational organized crime groups using cryptocurrencies to facilitate traditional crimes such as money laundering, drug trafficking, and human trafficking. Of the $40.9 billion in illicit cryptocurrency volume last year, nearly $11 billion was directed to wallets involved in hacks and scams.

Additionally, stablecoins continue to dominate as the preferred vehicle for illicit fund transfers, representing nearly two-thirds of total illicit transaction volume while accounting for 77% of general cryptocurrency volume.

Chainalysis concludes that “while we anticipate this ratio will increase over time, historically it has remained consistently below 1%.”