According to their Thursday report, revenue from pig butchering scams—where fraudsters build relationships with victims to lure them into deceptive schemes—rose by nearly 40% in 2024 compared to the previous year.
Chainalysis estimates that total revenue from cryptocurrency scams in 2024 reached at least $9.9 billion, with the potential to escalate to a record $12.4 billion as more data becomes available. Researchers from the firm noted that the sophistication of crypto fraud and scams has continued to evolve.
The report highlighted that marketplaces facilitating pig butchering schemes and the application of generative AI have made it easier and more cost-effective for scammers to broaden their operations. Chainalysis indicated that generative AI technology could significantly amplify the scale of crypto scams.
The firm, which analyzes publicly accessible transaction data on the blockchain to track scam revenues, reported an average annual growth of 24% in crypto fraud activities since 2020.
The popularity and value of cryptocurrencies, particularly bitcoin, have surged in recent years as investors sought substantial returns and interest in blockchain technology increased. This sector experienced notable growth following the election of U.S. President Donald Trump in November, driven by expectations of a more favorable regulatory landscape.
Other notably profitable scams included crypto drainers, where fraudsters impersonate legitimate blockchain projects to gain control of victims' cryptocurrency wallets, and high-yield investment scams that promised extraordinary returns, as per Chainalysis. In January 2024, a crypto drainer impersonated the U.S. Securities and Exchange Commission after the agency's X account was compromised.
Cryptocurrency ATMs have emerged as significant targets for scams, as reported by Chainalysis. Scammers frequently pose as government representatives or customer service agents to persuade victims to deposit cash into these machines.