Here is the positive effect of the fall of Bitcoin and other cryptocurrencies
News hardware Here is the positive effect of the fall of Bitcoin and other cryptocurrencies
Over the past few months, Bitcoin has been bucking the downtrend of the crypto market. In this usual bearish cycle, the context is difficult for some, but it doesn’t necessarily bring all bad news.
The rise of Bitcoin has attracted crypto scams
The decline in the value of Bitcoin and other cryptocurrencies did not only have negative consequences. Over the past two years, the explosion in cryptocurrency prices has attracted a lot of ill will.
Increasingly democratized, these cryptographic virtual currencies have been subject to mass adoption, attracting new followers who may not necessarily master the security uses associated with blockchain. Therefore, although a few beginners managed to navigate between the sharks, some left their cryptocurrencies there by compromising their wallet.
If amateurs have been the target of identity theft and other amateur ransomware, some confirmed followers in the crypto sector have also been victims of more complex operational methods, such as network infrastructure hacks. This is evidenced by the recent hacking of the Solana wallet.
In another register, with the field booming, several cryptocurrencies and other tokens have also promised mountains and wonders to their investors with the aim of extracting money without doing the initial project. More commonly known as the Exit Scam, these scams also thrive on the growing crypto trend.
So, in addition to the vulnerability of individual users and organizations, it is clear that the sector was the target of the election, especially since it quickly became synonymous with incredible sums.
So the reason seems obvious: scams go hand in hand with bullruns. It is important to emphasize that this logic is found in almost every growth sector.
The bear market (crypto bear market) plays against scammers
In recent months, the trend of fraud in the cryptocurrency sector seems to be on the decline. Good news since cryptocurrencies have become a prime target for web3 fraudsters.
As the crypto market entered its bear market, scams are less attractive to hackers. Since the beginning of the year, the prices of all cryptocurrencies have plummeted, and investors aren’t the only ones on the move.
Indeed, the bear market does not only bring bad news because after this decline, even scammers seem to be no longer interested in the sector.
In a study conducted by Chainalysis, we learn that the sector experienced less fraud during 2022.
Reduced income from crypto scammers
After the bursting of the speculative bubble, the crypto sector saw a significant drop in transactions. Therefore, fraudsters are much less profitable.
According to Chainalysis, fraudsters reportedly generated $1.6 billion in revenue, a 65% year-over-year drop. By 2021, they recorded no less than 5 billion dollars.
In addition to the drop in illegal transactions and the hardening of a few followers, Chainalysis believes that these numbers can also be explained by the overall decline in value. Indeed, fraudsters’ profits were higher when Bitcoin was around 60,000 euros. In this perspective, to get the same ransom, the hacker now has to extort 3.
This consolation prize gives investors at least some peace of mind during this bear market. The data also shows the tendency of market players to be increasingly suspicious of malicious attempts of any kind. The backdrop of a bear market isn’t just marred by bad news – this bear trend also cleans up and optimizes technology to make it more compelling for future users.