Scammers using cryptocurrencies have seen their revenue plummet by one-third because of the coronavirus-induced mark crash, which saw the price of BTC drop from $7,100 to under $4,000 in a two-day period.
According to research conducted by Chainalysis, on a seven-day moving average, the revenue earned by scammers dropped from $800,000 in the middle of January to less than $300,000 early this month. Per Chainalysis, the total daily value sent to crypto scams dropped 61% between March 13 and 31.
Source: Chainalysis
The research report adds that nearly all of the revenue losses scammers suffered are concentrated on investment scams and Ponzi schemes, which make up the majority of the cryptocurrency scamming activity.
While the coronavirus outbreak hurt these scammers specifically, Chainalysis adds, it has given other scammers a chance to form a new narrative surrounding it. Blackmail and phishing scams using cryptocurrencies have started growing, as scammers either pose as health organizations asking for donations, or try to blackmail their victims threatening to infect them with COVID-19.
As CryptoGlobe reported, scammers have even started impersonating the World Health Organization (WHO) to mislead their victims into sending them BTC, thinking they were sending them to the WHO’s COVID-19 Solidarity Response Fund.
This means that the number of individuals transactions being sent out to scammers actually hit a year-to-date high at the start of April. Scammers’ revenue, nevertheless, dropped because cryptocurrency prices dropped. The report reads:
We believe scammers are still receiving those same payments from roughly the same number of victims per month. The payments are just worth less now due to cryptocurrency price drops.
Cryptocurrency prices have, however, been moving up. This could mean that as the market rebounds scammers may be the first ones to feel the benefits, as their revenues will go up.
Featured image via Pixabay.
