Cryptocurrency scammers have received $7.7 billion worth of cryptocurrency from victims in 2021, said blockchain analysis firm Chainalysis.
Nearly $1.1 billion worth of cryptocurrency of the $7.7 billion was attributed to a single scheme which allegedly targeted Russia and Ukraine.
One of the main sources of rising cryptocurrency scams in 2021 was rug pulls, where the developers of a new cryptocurrency vanish and take supporters’ funds with them. Rug pulls accounted for 37 percent of all cryptocurrency scam revenue at $2.8 billion.
Chainalysis said the number of active financial scams rose to 3,300 in 2021 from 2,052 in 2020. The number of cryptocurrency scams increased in line with the rise in value of popular cryptocurrencies such as Ethereum and Bitcoin.
Chainalysis said the most important takeaway is to avoid new tokens that haven’t undergone a code audit. Code audits are a process through which a third-party firm analyses the code of the smart contract behind a new token or other DeFi project.