Criminal activity in the crypto space is increasingly moving across blockchain networks. A new report from blockchain analytics firm Elliptic reveals a staggering 200% rise in cross-chain crime over the past two years. According to the report, over $21 billion in illicit or high-risk crypto assets have been laundered using cross-chain bridges, decentralized exchanges (DEXs), and coin swap services.
The report, ‘The State of Cross-Chain Crime 2024,’ highlights how criminals are exploiting the growing interoperability between blockchains to move funds and evade detection. These cross-chain swaps allow assets to be converted between different blockchains without going through centralized exchanges, making it difficult for regulators and investigators to track illicit flows.
“From North Korean cyber actors to sanctioned entities, scams and dark web markets, threat actors are increasingly using cross-chain methods to evade detection,” Elliptic mentioned in their X post.
Elliptic also pointed out that criminal actors are taking advantage of the lack of regulation around many cross-chain protocols, with some laundering methods designed specifically to exploit these blind spots. The report confirms the term “chain-hopping”, which is the rapid swapping of illicit crypto, back and forth between different assets or blockchains. This is soon becoming a mainstream money laundering typology.
The firm warned that as crypto ecosystems become more interconnected, the risks of cross-chain crime are likely to grow unless regulators and industry participants implement stronger compliance and monitoring mechanisms. This sharp increase in illicit cross-chain activity is also a reason for the urgent need for better tools and global cooperation in tracking crypto crime.