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Crypto Journalist
Veronika Rinecker
Crypto Journalist
Veronika Rinecker
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Crypto scammers defrauded victims of at least $9.9 billion in 2024, marking one of the most significant financial crimes of the year.
While this figure represents a 29% drop from the record $14 billion stolen in 2021, experts warn that the final number could exceed $12 billion as more fraudulent transactions come to light.
These findings come from a report released on Feb. 13 by blockchain data and analytics firm Chainalysis, which outlines how fraudsters have adopted advanced technologies like artificial intelligence (AI) and leveraged professional scam networks to enhance their operations.
Pig Butchering Surges While Investment Scams Decline
The most alarming trend of the year was the sharp rise in “pig butchering” scams, which grew by almost 40% year-on-year (YoY) and accounted for over 33% of total scam revenue.
These scams, which involve fraudsters building fake relationships with victims to defraud them over time, have become more widespread. Originally concentrated in large scam compounds in Southeast Asia, these operations have now expanded to other regions, including Nigeria and Namibia.
Meanwhile, high-yield investment scams (HYIS) accounted for over 50% of total crypto scam revenue.
However, HYIS inflows declined by almost 37% YoY. One notable example is Smart Business Corp, a Ponzi scheme targeting Spanish-speaking investors, which amassed approximately $1.5 billion in cryptocurrency transactions despite repeated regulatory warnings.
Crypto ATMs have also become a favored tool for scammers, particularly in targeting elderly individuals.
In the first half of 2024 alone, as per the report, losses from crypto ATM-related scams in the US surpassed $65 million, with an average individual loss of $10,000.
Huione Guarantee: A Hub for Money Laundering and Fraud
A key enabler of modern scam operations is Huione Guarantee, a peer-to-peer (P2P) marketplace associated with a Cambodian conglomerate.
Huione has become a hub for fraudulent activity, facilitating money laundering, AI-driven fraud tools, and other illicit services.
According to Chainalysis, Huione processed around $70 billion in crypto transactions, with approximately $375.9 million linked directly to vendors providing scam-enabling technology.
Crypto Scammers Embrace AI: From Fake Identities to Exploiting Job Seekers
The rapid evolution of AI has given scammers powerful new tools to execute increasingly sophisticated schemes.
AI-generated fake personas, deepfake videos, and cloned websites make scams harder to detect. Fraudsters openly advertise AI “face-changing” software on platforms like Huione Guarantee, making it easier to evade law enforcement.
Scammers have also diversified their methods beyond traditional long-term frauds.
Newer schemes, such as employment scams, have seen a sharp increase, according to the report. These scams trick job seekers into performing fake tasks and require upfront payments for “fees.”
Although these scams yield smaller individual payouts, the sheer volume of victims makes them highly profitable. In 2024, the number of deposits to pig butchering scams surged by 210%, indicating an expansion in the victim pool, even as the average deposit per victim dropped by 55% YoY.
Regulators Take Action
The alarming rise of crypto-related fraud has triggered regulatory action worldwide.
In the US, the Senate Judiciary Committee in September 2024 pressured major crypto ATM operators to implement stronger fraud prevention measures.
States like California and Arizona have introduced legislation imposing daily transaction limits and requiring crypto ATM providers to register as money transmitters.
In Europe, regulators under the Markets in Crypto-Assets (MiCA) regulation have cracked down on unregistered crypto ATMs, citing their role in money laundering.
Some European countries took a proactive approach before MiCA went into effect. In August 2024, Germany’s Federal Financial Supervisory Authority (BaFin) seized 13 crypto ATMs from 35 locations.
APAC countries, including Singapore and Australia, have also imposed strict regulatory measures to curb misuse.
