Crypto Ransom Payments Hit $1B in 2023: Chainalysis

Crypto ransom attack payments surged to a record $1 billion in 2023, according to blockchain analytics firm Chainalysis. Targeting institutions like hospitals, schools, and government offices, scammers raked in $1.1 billion last year, nearly doubling the $567 million from 2022. However, Chainalysis noted a decrease in losses from other crypto-related crimes such as scamming and hacking during the same period.

Bitcoin, the leading cryptocurrency, soared by 60% since September, reaching $43,134. This surge was fueled by optimism surrounding a new U.S. bitcoin ETF and indications of central banks worldwide considering interest rate cuts. Chainalysis attributed the rise in ransom payments to an influx of new participants attracted by the potential for substantial profits and lower entry barriers.

The prevalence of “big game hunting” has grown in recent years, with a significant portion of ransom revenue coming from payments exceeding $1 million. Notably, a group of digital extortionists called “cl0p” exploited the file-sharing software MOVEit, amassing nearly $100 million in ransom payments. Numerous organizations, including government agencies, the UK’s telecom regulator, and energy giant Shell, reported cybersecurity breaches involving the MOVEit tool.

In November, it was revealed that the cybercrime group “Black Basta” extorted over $107 million in bitcoin, with a considerable portion of laundered ransom payments funneled through the sanctioned Russian cryptocurrency exchange Garantex. Additionally, UN reports indicate that cryptocurrency theft via cyberheists and ransomware attacks serves as a significant source of funding for North Korea.

However, Chainalysis cautioned that its data underestimates crypto’s role in crime, as it only tracks cryptocurrency sent to identified illicit wallet addresses. Payments for non-crypto-related crimes, such as crypto used in drug trafficking, are not included in their analysis.