In 2019 and 2020, crypto thefts and hacking grew by 38.8% from 370.7 to 513m dollars, Trading Platforms UK states. This doesn`t yet outstrip 2018 figures in Britain. Fraudsters took cryptocurrency worth 950 million dollars in 2018, which is the maximum for the five year period.
On the whole, in Europe, fraud cases and blockchain hacking decreased from 4.4 to 1.3 bn. dollars (57.77% decline). Experts say this is the maturity age for the crypto market when fraudsters` activities can be spotted and disrupted.
The main factors to contribute to cryptocurrency fraud establishment are the following. Firstly, the situation with COVID-19, which triggered an increased demand for digital assets; digital assets have become really popular with the public. Secondly, absence of paper documentation in transaction procedures – the biggest advantage of cryptocurrency workflow, which turns out to be, however, a drawback. Thirdly, it is impossible to trace money as there is no centralized system (such as a banking system). All that makes good ground for fraud.
Most blockchain projects and cryptocurrency startups are still experimental and speculative, analysts say. This means that some weaknesses still exist. However, state regulators tend to strengthen control over the sector. So in the future, the procedure of starting a bitcoin wallet or making transactions of digital assets will be easier, safer, elaborated and regulated by law.