Crypto Exchanges Make Up 64% of Ransomware Attackers Launder Proceeds

Ransomeware proceeds through crypto exchanges

Chainalysis alleges that 64% of ransomware attack cash-out strategies consist of the laundering of funds by means of crypto exchanges.

United States-based blockchain intelligence agency Chainalysis believes that 64% of ransomware attack cash-out strategies involve the laundering of funds via cryptocurrency exchanges. The data was announced in a Chainalysis webinar attended by Cointelegraph on May 30.

A ransomware attack is based on the infection of a target with malware and the demand of a ransom payment– regularly denominated in cryptocurrencies. The fee is demanded in return for the so-called delivery of a decryptor tool that can aid victims recover access to their data.

Ransomware Proceeds

Chainalysis– which delivers blockchain analytics tools that make it possible for firms, governments and police to keep an eye on blockchain transactions and track suspected illicit activities– claims that 64% of ransomware attackers launder their ill-gotten funds through crypto exchanges.

Chainalysis has ostensibly established 38 exchanges– without revealing their names– that directly received funds from an address related to a ransomware attack.

Among other ransomware cash-out strategies examined, 12% included mixing services and 6% involved peer-to-peer networks, whilst others went via merchant services providers or dark web marketplaces. 9% of ransomware supposedly remain unspent.

The analysis also indicated that ransomware attacks generally involve less complicated cash-out networks as compared to crypto exchange hacks. Chainalysis argued that this is for the reason that a hack often involves a sizable amount of money leaving a known exchange, often attracting high media publicity, and necessitating that hackers disguise the flow of funds more robustly.

Ransomware example

By contrast, ransomware campaigns normally involve smaller discrete sums to multiple addresses and are ostensibly less publicized, as a result avoiding intense, immediate scrutiny.

As well as cash-out strategies, Chainalysis also identified a shift in the ransomware threat landscape. Previous trends, according to the firm, had been to administer wide and shallow attacks– invading a vast amount of indeterminate victims and seeking small amounts as a ransom to decrypt files. Current trends, unfortunately, reveal that crooks are shifting to targets with legally or politically delicate data, as well as raising the amount of ransom payment demanded.

As recently revealed, Coveware’s Q1 2019 Global Ransomware Marketplace report showed that bitcoin (BTC) continues to account for the lion’s share– 98%– of crypto-denominated ransomware payments. The report, reflecting Chainalysis’ claims, identified that the average sum demanded had risen 89% from a median $6,733 in Q4 2018 to $12,762 in Q1 2019.

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