Hacker illustration

Blockchain forensic firm Chainalysis has found that the average profit made by cryptocurrency scams has dropped by 30 percent since the start of the year, the firm said in a blog post on 10 April.

Even though scammers have found new ways to dupe people into giving them cryptocurrency, by leveraging COVID-19 fears, the research shows that their revenue has dropped from around $800,000 in mid January to below $300,000 at the start of April. The drop in scammers revenue is likely due to the mid-March crypto market crash.

Value of crypto assets sent to known scam addresses
Value of crypto assets sent to known scam addresses. Chainalysis

As seen from the data, the total daily value received by scam wallets has dropped by 61 percent over the first two weeks of March, after sitting at around $10,000. Since then, the value taken in by scams seems to have rebounded, from around $5,000 a day to roughly $7,000.

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Even though COVID-19 scams have been on the rise, such as scammers claiming to possess lists of people who have tested positive for COVID-19 in a given area, Chainalysis has noted that the majority of scammed crypto has been taken by investment scams and Ponzi schemes, which represent the vast majority of cryptocurrency scamming activity. The firm said:

“In short, while COVID-19 is providing phishing and blackmail scammers with new fraudulent stories to entice victims, the cryptocurrency price drops spurred by the pandemic have drastically reduced the revenue of the Ponzi schemes and investment scams that make up most cryptocurrency scamming activity.”

The firm has also identified an increase in email scams, which use the coronavirus pandemic as a way to trick their victims into handing over their cryptocurrency. Last week, Chainalysis pointed to an email scam, where fraudsters pretended to be from the Centers for Disease Control and Prevention in order to request donations for COVID-19 treatment research.

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