Matthew RosenquistFounder & CISO Advisor, Cybersecurity Insights · CISO, Cybersecurity Strategist, & Industry Advisor

Is Cryptocurrency Mostly Used by Criminals

20 Mar 2023 · 2 min

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2:15

The video addresses the common perception that cryptocurrency is primarily a tool for criminal activity. It cites the reputable blockchain analytics firm Chainalysis, which reports that less than 0.25% of cryptocurrency transaction volume—about $21 billion—is linked to illicit activity. To contextualize this figure, the narrator references the United Nations Office on Drugs and Crime, which estimates that 2–5% of global GDP (roughly $1 trillion) is involved in money‑laundering, a broader category of crime. An official from the U.S. Treasury, Jennifer Fowler, is quoted emphasizing that cash and the U.S. dollar remain the preferred currencies for criminals worldwide. The conclusion is that over 99% of crypto transactions are legitimate, making cryptocurrency far less associated with crime than cash or other fiat currencies.

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Is cryptocurrency mostly used by criminals? To answer the question, we need to look at the best source of data. Chainalysis is a very respected company that specializes in tracking digital currency transactions, and they work with law enforcement agencies around the globe. Chainalysis produces an annual report that quantifies the amount of illicit transactions on the major cryptocurrency blockchains like Bitcoin. It is no surprise that cybercriminals do like to use cryptocurrency, but the amount may surprise you, that the overall transaction volume is extraordinarily very low. Less than a quarter of 1% of transactions are tied to illicit activity. Now, that accounts for just under $21 billion. And that may seem like a lot, but to put that into perspective, the United Nations Office on Drugs and Crime estimates that between 2 and 5% of global GDP, about a trillion dollars, is involved with just money laundering activities. That isn't even all the crime. That's just money laundering. So it is even just compared to money laundering, it is a drop in the bucket. Jennifer Fowler, a Deputy Assistant Secretary for the Terrorist Financing and Financial Crimes at the U.S. Department of the Treasury: the U.S. dollar is the currency of choice. Cash is still king. When it comes to criminals around the globe. So no, cryptocurrency is not mostly used by criminals, with over 99% of transactions not being associated with illicit activity. In fact, it's a much lower percentage than that of cash or any other international currency.