According to Chainalysis, romance scam activity — also known as pig butchering — has grown 85 times since 2020. This is on the back of the growing global scam economy, which saw US$1.02 trillion being scammed globally between August 2022 and August 2023, with victims in Singapore losing the most money on average.
The average amount of money extorted through romance scams in 2023 came in at $4,593, far higher than other forms of scams such as charity scams or phishing scams.
Chainalysis categorizes such romance scams based on information from victims, customers or partners, and other sources, indicating that the scammers are utilizing the tactics typical of a romance scam, meaning that they’re contacting individuals and attempting to build relationships in order to con them.
The firm notes that even though total scam amount dropped y-o-y, this is a lower-bound estimate based on value sent to addresses currently identified as scams. In reality, the figure could be higher.
See also: Alexander Hamilton’s three lessons for stablecoins
Meanwhile, Chainalysis has also discovered that more than 60% of all illicit crypto transactions, or about US$14.9 billion in crypto transaction volume, went to sanctioned entities.
This includes Iran, the most sanctioned country in the world before Russia invaded Ukraine, which is a major adopter and user of crypto. “In 2023, 73.3% inflows to Iranian exchanges came from international mainstream exchanges and could indicate that Iranian services are heavily used to facilitate transfer of value in and out of the country,” Chainalysis finds.
Since Iran legalized cryptocurrency mining in 2019, experts have warned that the country could use crypto mining as a revenue generation tool to mitigate the impact of global sanctions, according to Chainalysis.
“Considering this data, in the absence of access to traditional financial systems, Iranian exchange users may be leveraging licit services like the international mainstream exchange ecosystem to transfer and store value,” the firm notes.
