"Alfa" and "Beta" of Crypto Crimes

16 Sep 2019 by svet

Yesterday I was having a fun at the expense of "Chainalysis" fuzzy pie chart. Today I decided to have a closer look at what people in this company are really doing during their working hours. It turns out to be quite exiting journey.

Let's have a look at their yearly "Crypto Crime Report" report. It has 33 pages some of which are quite entertaining. For example, they have there this statement (citing): " ... illicit transactions comprised less than 1% of all economic bitcoin activity in 2018, down from 7% in 2012." That we have already known.

However, here's what they say next: "The hacking of exchanges is far and away the most costly type of crypto crime, generating around $1 billion in hacking revenues in 2018 alone. (>50%)" Okey, no surprise here. But then: " ... We track the two prominent hacking groups responsible for a majority of these stolen funds." So, if their assertions are correct, only two groups are perpetrating most cyber-crimes in the world for which regulators and law enforcers hold then all of us as hostages of their insane "global" policies.

Moreover, "Chainalysis" investigators even identified some "psychological" characteristics of those two groups, which they call "Alfa" and "Beta" (citing): "Alpha, is a giant, tightly controlled organization partly driven by nonmonetary goals (instigating the panic among population and disrupting organizations and businesses) ... group Beta, seems to be a less organized and smaller organization absolutely focused on the money."

Curious, isn't it? We have "Che Guevaras" and "Goldfingers" almost openly go after our money like it is a government concession, while congressmen continue to vilify college students with 0.5 ETH on their "unregistered" accounts.

Speaking about ETH. It turns out that: "In 2018, only 0.01% of ether was stolen in scams, worth $36 million ... This makes scamming on the Ethereum blockchain one of the lowest-earning types of crypto crime analyzed in this report for 2018". BTW, "ICO scams" constitute almost negligible part of those thirty-six million. Most of ETH going into crooks pockets are due to old "fishing" technique.

Now the part of this report which is really worrisome (depending on your personal stance, actually) is that: "... (BTC) flowing to darknet markets is back on the rise, averaging around $2 million worth of bitcoin alone every day (which is still less than 1% of all BTC transactions)". According to examiners "Chainalysis" almost all of those transactions are sales of illegal substances.

Moreover: "... as law enforcement gets better at shutting down centralized darknet markets, a new distributed model for darknet market activity has emerged." Some might say, however, that governments itself have created this issue by their unreasonable and outdated policies.