Scammers are highly adaptable and can quickly change their tactics depending on the market situation, according to a recent webinar hosted by well-known blockchain analytics firm Chainalysis. The company analyzed crime trends within the crypto industry during the crypto winter and found that scammers were able to adapt to the developments and volatility of the crypto market.
Different scams behaved differently during the bear market, with free giveaway and romantic scams being the most successful in swindling money from victims.
Scammers After the Terra Collapse
Chainalysis data revealed how scammers adapted their tactics to the crypto market’s volatility in the wake of the catastrophic collapse of Terra in May 2021. Investors became increasingly hesitant to invest in projects after the fall of the algorithmic stablecoin and the subsequent contagion. Consequently, investment scams were no longer as successful as they used to be. Scammers had to switch tactics to lure victims in with free giveaways and romantic scams.
Cybercrimes research lead at the firm, Eric Jardine, explained, «It’s suggestive here that there is an adaptation on the part of the scammers, and market conditions make investment scams unlikely to be profitable; they may be substituting their tactics toward other scams that play on different emotional sense.»
Crypto Scams from 2021 to 2022
The overall revenue from digital asset scams decreased by nearly 50%, from nearly $11 billion in 2021 to $5.9 billion in 2022. Revenue from ransomware attacks declined by 40.3% to at least $456.8 million in 2022 from $765.6 million in 2021. This decline was attributable to victims’ increasing unwillingness to pay ransomware attackers, rather than a decline in the actual number of exploits. On the other hand, multi-level marketing scams accounted for a majority of stolen funds last year, while nearly $1.3 billion of crypto scam revenue was attained through the hyperverse scam.
