Crypto scammers have suffered a drop in income along with the rest of the working world, according to blockchain investigative firm Chainalysis. The company discovered that cryptocurrency sent to known scams dropped by 61% in March, with established scams faring the worst.
Covid-19 has reduced revenue for the biggest cryptocurrency scammers, but given others a new narrative to fool victims with. We dig into the data and assess the threat in our latest blog. https://t.co/6aDYwugbuu
— Chainalysis (@chainalysis) April 10, 2020
Scammers’ Income Dented
Chainalysis found that the amount of money being sent to known crypto scams fell dramatically around the middle of March, collapsing from some $700,000 to under $300,000 just two weeks later, although April has seen a recovery above the $400,000 mark.
The reduction in money being sent to scams correlates with the rapid spread of coronavirus in the West, while many countries are in lockdown. So does this trend suggest that stories of scammers taking advantage of the coronavirus crisis are overblown? Not according to Chainalysis:
Nearly all of the scam revenue losses so far are concentrated to investment scams and Ponzi schemes, two scam sub-categories that together make up the vast majority of cryptocurrency scamming activity. But while Covid-19 has hurt that set of scammers, it’s giving others who favor email spamming tactics new stories they can use to try and fool their victims.
The Bigger They Come…
Chainalysis adds that the biggest scams are being affected the most, with the weekly average amount being sent to the most ‘popular’ investment scams and Ponzi schemes dropping by 33%, from $4.2 million to just under $2.9 million:
As we reported two weeks ago, the coronavirus pandemic has caused scammers to get creative with their efforts to part people from their money, with everything from fake medical supplies websites popping up to the sale of information regarding the outbreak, including names of infected individuals in a local area, being advertised.
It is a sad truth that there are people out there who are looking to cheat vulnerable and frightened people out of their money at a time like this, but it is a reminder to always be on our guard and learn to spot what a crypto investment scam looks like before we succumb to its charms.