The growing popularity of cryptocurrencies has placed Russia among the adoption leaders. But while it hasn’t reached the top of the rankings, the country already has a “disproportionate share” of global activity related to some form of cryptocurrency-linked crime, according to a new study from Chainalysis.
Three-quarters of ransomware revenue traceable to Russia, researchers say
Blockchain analytics firm revealed this week that individuals and groups based in the Russian Federation, ranked in the top 20 of the Global Crypto Adoption Index by Chainalysis, could be linked to nearly $400 million in crypto-denominated ransomware revenue. In a preview of its 2022 Crypto Crime Report, Chainalysis elaborated:
Overall, about 74% of ransomware revenue in 2021 – over $400 million worth of cryptocurrency – went under stress, we can say that is likely to be associated with Russia in some way.
The platforms, which operate primarily on the Russian crypto market, have largely committed extortion money, the US-based company further alleged, citing web traffic data. An estimated 13% of money sent from ransomware addresses to service providers went to users living in Russia. The authors noted that these crypto laundering activities are greater in other areas.
According to Chainalysis, dozens of cryptocurrency businesses that facilitate the laundering of illicit money are headquartered or operate in Moscow City, the financial district of the Russian capital. Many of them are believed to have processed a significant number of transactions originating from addresses linked to the crime.
One of them is crypto broker Suex, which was blacklisted by the US Treasury Department’s Office of Foreign Asset Control (OFAC) in September last year. The platform, which has offices in Moscow and St. Petersburg, is suspected of processing hundreds of millions of dollars in scams, ransomware attacks, crypto transactions related to darknet markets and the infamous BTC-e exchange.
Chainalysis reported that these businesses received approximately $700 million worth of cryptocurrency from illegal addresses during the three-year period investigated in the study. This accounts for 13% of all crypto funds sent to these platforms, with the total volume reaching a high of about $1.2 billion in the second quarter of 2021.
The report also pointed out that scams and darknet markets account for $313 million and $296 million of illicit cryptocurrencies transferred to companies based in Moscow City between 2019 and 2021, respectively. Ransomware comes in third place with $38 million.
The figures have been published after Russian law enforcement recently took action against cybercrime actors who use cryptocurrencies. In January, the Federal Security Service (FSB) busted the infamous Revil ransomware group at a US request, arresting 14 of its members in an operation conducted with the Ministry of Internal Affairs.
A study by another blockchain analytics firm, Elliptic, revealed last week that Russia also blocked four major dark web sites with an estimated $263 million in crypto sales. The Interior Ministry has called for the arrest of six more hackers accused of “illegal circulation of means of payment” while authorities work to regulate the expansion of the Russian crypto market.
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