Crypto scam: January 2023 vs January 2024

Our team analyzed crypto losses as a result of fraudulent actions for the first month of the year - January and compared the indicators for 2023 and 2024. The indicators for January allow us to understand market trends for the coming year, provided that force majeure does not occur. It’s not for nothing that theya say “A fulfillment of an upcoming year depends on how you spend your New Years Eve.”
Analysis of crypto losses in recent years is an important indicator not only for investors and market experts, but also for ordinary users.
At the end of 2023, the turnover of funds in the blockchain from criminal activities exceeded the mark of $22 billion, thereby decreasing by 29.52% compared to 2022.

Source: Chainalysis

It should be noted that data for both years (2023 and 2022) show significant differences, highlighting the dynamics of change and possible trends in this area.

While January 2023 showed relatively low values, the first month of 204 surprised with the volume of illegal transactions. I wouldn’t like to think that 2024 will beat 2022’s record for crypto scammers, but these are the trends so far.
What happened in January 2023?
Let us present a few facts from the time period of a year ago to briefly return you to the historical outline:
November 11, 2022, a month and a half before January 2023, the top 2 exchange in terms of funds turnover - FTX - collapsed
A huge part of the funds “evaporated” from the market after the collapse of LUNA and FTX, and the price of Bitcoin fell by more than 60%. Confidence in cryptocurrencies has been undermined and digital asset prices have reflected stock market losses due to current high inflation and rising interest rates
Bitcoin cost ~$16,700, being at almost its absolute minimum since the end of 2020.
Based on the results of 2022, January was characterized as a difficult period for cryptocurrency. Investors are waiting for the market to recover, and unprepared users are fleeing the WEB3 world. Perhaps these factors influenced the fact that there were not very many crypto losses in January.

We list some major crypto losses of this period:
HECO platform
Amount of losses: 6 000 000 USD

The lending platform HECO was suspected of being attacked and lost almost $6 million. The reason for the attack is that LendHub has two lBSV cTokens, one of which was abandoned by its creators in April 2021, but was not removed from the market, resulting in both the old and new lBSV existing in the market.
NFT Mutant Ape Planet
Amount of losses: 2 900 000 USD

Aurelien Michel, the developer of MAYC's Mutant Ape Planet NFT series, pleaded guilty after being arrested for allegedly embezzling $2.9 million. Michelle and the other defendants sold the Mutant Ape Planet NFT to potential buyers, promising "rewards, sweepstakes, exclusive access to other crypto assets, and community-controlled wallets to fund the marketing of the NFT collection." The project developer also implicitly promised that NFT holders would be able to receive “metaverse land.” However, none of Michel's promises were fulfilled. Once all the NFTs were sold, he and the other defendants allegedly transferred $2.9 million in proceeds to other wallets, including ones controlled by Michel himself.
NFT project Moonbirds
Amount of losses: 1 000 000 USD

Kevin Rose, founder of NFT project Moonbirds, tweeted that his personal wallet was hacked and 25 Chromie Squiggles and other NFTs were lost, with an estimated loss of more than $1 million. As a result of the phishing attack, Rose was forced to sign, which caused the loss.

The results of crypto losses in January 2023 were:

16 crypto incidents totaling 14,158,063 USD

Source: AML Crypto

Source: AML Crypto

From these inputs, several conclusions can be drawn about the state of the cryptocurrency market during the specified period. First, the collapse of FTX, one of the largest crypto exchanges, was a significant event, highlighting the vulnerability of even the largest players in this space. But, despite such a poor state of the market a year earlier, all this could become a catalyst for the development and improvement of the cryptocurrency industry.
What happened in January 2024?
Although January 2024 was quite recently, let’s refresh our and your memory:
US regulators are agreeing on a decision on updated applications from investment companies to create exchange-traded funds (ETFs) with cryptocurrencies. We've all probably heard about Bitcoin ETFs.
Bitcoin price reaches its highest since January 2022 and exceeds $46,000
Events in the crypto market in 2023 will likely have a strong impact on 2024. Last year, especially its final part, was a year of recovery for the blockchain technology market. We can say that the “crypto winter” is over and the end of 2023, instead of winter, brought us a truly full-fledged spring. The price of Bitcoin is not rapidly, but confidently, recovering and, looking ahead, by the end of February 2024 it will reach its maximum since December 2021.
Did you know that the absolute maximum price of Bitcoin was reached on November 10, 2021 and amounted to $68,789.63? The absolute minimum price of Bitcoin in 2014 was $0.04865. Thus, if someone bought Bitcoin on July 14, 2014 for $100, then he became a millionaire with a net worth of at least $141,395,789.

These are the things... If you now regret something, then you have experienced FOMO.

Let's list some major crypto losses:
Amount of losses: 112 500 000 USD

On January 31, according to blockchain researcher ZachXBT, the Ripple CEO was the victim of a hacker attack that resulted in the theft of 213 million XRP, worth approximately $112.5 million. Ripple co-founder Chris Larsen tweeted: “Yesterday there was unauthorized access to several of my personal XRP accounts (not @Ripple) - we were able to quickly identify the issue and notify exchanges to freeze the affected addresses. Law enforcement agencies are already involved.”
Amount of losses: 11 580 000 USD

South Korean social music service Web3 Somesing announced that it was the victim of a security vulnerability attack that resulted in the loss of 730 million native tokens (SSX), equivalent to approximately US$11.58 million.
Amount of losses: 11 580 000 USD

Gaming blockchain platform GMEE announced on Twitter that Polygon's GMEE token contract was compromised on GitLab, resulting in the theft of 600 million GMEE tokens. Subsequently, the attacker exchanged the tokens for ETH and MATIC.
The results of crypto losses in January 2024 were:

34 crypto incidents totaling 170,352,563 USD

Source: AML Crypto

Source: AML Crypto

Source: AML Crypto

The beginning of 2024 was marked by significant events in the crypto market, which will undoubtedly have an impact on its future development. On the one hand, we see positive dynamics in the restoration of the value of Bitcoin, which has reached significant heights compared to previous periods. This process can be considered the symbolic end of the “cryptowinter” and the beginning of a new stage in the development of cryptocurrencies.

On the other hand, January 2024 also brought a number of large crypto losses, highlighting the ongoing risks and security challenges in this space. The incidents with Ripple, Somesing and GMEE show how important it is for market participants to maintain a high level of vigilance and security of their assets.

These developments are a reminder of the need to balance innovation and security in the crypto market. While cryptocurrencies continue to attract attention as investment and speculation vehicles, lessons learned from crypto losses should encourage improved protections and regulation.
AML Crypto team's opinion
Even if you just look at the amount of losses at the beginning of 2023 and 2024, the leader has a clear advantage over the latter. Despite this and noticeable fluctuations in general, the market demonstrates resilience and the ability to recover, which is confirmed by the upward dynamics of the value of Bitcoin and other tokens, as well as increasing interest in exchange-traded funds (ETFs), stablecoins and other blockchain technologies.

However, the increase in the number and scale of crypto losses in January 2024 cannot be ignored. It reminds us of the need to continue working to improve the security and regulation of the crypto market.

For the sustainable development of the cryptocurrency market, it is necessary to strive for transparency, responsibility and protection of the interests of all market participants. To achieve these goals, the AML Crypto team has developed the Btrace tool, which allows you to check a crypto address, know the risks associated with it and the sources of origin of funds. Free AML check for every new user.
Check blockchain address using Btrace
In seconds, determine the risk level of the counterparty’s address, find out the source of his funds and make an informed decision about interacting with him.




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