$1.2 Billion Lost in Cryptocurrency Related Scams and Fraud in Q1 2019: Report

By Nivesh Rustgi
Published May 1, 2019 Updated May 1, 2019
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$1.2 Billion Lost in Cryptocurrency Related Scams and Fraud in Q1 2019: Report

By Nivesh Rustgi
Published May 1, 2019 Updated May 1, 2019

Bitcoin and Cryptocurrency have been gaining a lot of mainstream traction since the past couple of years. Before the Bitcoin and cryptocurrency prices made the headlines in 2017, the general perception of cryptocurrency was negative. While the perception is changing now, a recent report reveals that the situation hasn’t improved considerably from the past year.

Cipher Trace is an Anti-Money Laundering (AML), Cryptocurrencies Forensics and Blockchain Threat Intelligence firm in the US. It published its report on the volume and nature of Cryptocurrency related scams and frauds. The report cited that while the widespread cryptocurrency related scams have reduced slightly, there has been a total loss of $1.2 billion through frauds and mishappenings reported in Q1 2019. 

It included the $190 million lost through the QuadrigaCX Exchange after the sudden obituary of its CEO Gerald Cotten, who was the sole keeper of the Exchanges’ cold wallets.

“Crypto crime has gotten worse because regulations are still weakly enforced. Europe broadly has not implemented its regulations yet and the cyber criminal community continues to grow,” CipherTrace chief executive officer Dave Jevans told Reuters.

The total cryptocurrency related frauds have siphoned funds to the tune of $851 million, and the Exchange-related issues and scams accounted for the rest $356 million.

The report also noted that due to strict regulations and global presence of Bitcoin and cryptocurrency Exchanges there was a 46% increase in cross-border payments to foreign Exchanges. The reported all added that it was

“contributing to the $8.7 trillion, or 11.5 percent of the world’s wealth, hidden offshore..”

Therefore, the report reiterates the need for cryptocurrency based regulations which have opened the floodgates for moving funds off-shore, which “are far beyond the purview” of the regulators.

Do you think that the new global ubiquitous system will be a bane or boon for the economic system? Please share your views with us. 


The presented content may include the personal opinion of the author and is subject to market condition. Do your market research before investing in cryptocurrencies. The author or the publication does not hold any responsibility for your personal financial loss.
About Author
Nivesh Rustgi
1181 Articles
Nivesh from Engineering Background is a full-time Crypto Analyst at Coingape. He is an atheist who believes in love and cultural diversity. He believes that Cryptocurrency is a necessity to deter corruption. He holds small amounts of cryptocurrencies. Faith and fear are two sides of the same coin. Follow him on Twitter at @nivishoes or mail him at nivesh(at)coingape.com

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