Caroline Bishop
Aug 30, 2024 09:27
Chainalysis’ mid-year update highlights a rise in China-based CSAM networks and evolving crypto scams, including the notorious pig butchering schemes.
According to Chainalysis’ latest mid-year update, 2024 has witnessed a significant uptick in China-based networks dealing in Child Sexual Abuse Material (CSAM) and an evolution in crypto scam tactics, notably the infamous pig butchering schemes.
Key Findings
Chainalysis’ report highlights several concerning trends in the realm of crypto crimes. The update delves into the on-chain activities surrounding CSAM and the latest scam trends dominating the crypto landscape.
China-Based CSAM Networks
Chainalysis reports a notable increase in China-based CSAM sites since late 2023. These vendors are attracting a significant portion of global CSAM-related inflows, peaking at 38.8% in Q1 2024. Many wallet holders are purchasing long-term access to these illegal services, with some transactions indicating nearly permanent access.
The Internet Watch Foundation (IWF) has noted the difficulty in determining the exact reasons behind this surge. A spokesperson mentioned that the rise could either be due to an increase in reporting or the emergence of new networks.
Scam Trends
Crypto scams have also evolved, with scammers adopting more dynamic and lucrative tactics. The report identifies pig butchering as the most profitable scam type year-to-date (YTD). One Myanmar-based scam operation has netted at least $101.22 million so far in 2024.
Pig butchering scams involve scammers building a fake romantic relationship with their victims to extract money for supposed investment opportunities. These scams are often run by individuals who have been trafficked and forced to work in labor camps in Southeast Asia.
Additionally, scammers are shifting from broad-based Ponzi schemes to more targeted campaigns, including work-from-home scams and address poisoning.
Huione Guarantee and Laundering Networks
Huione Guarantee, a marketplace linked to the Cambodian conglomerate Huione Group, has been exposed as a major player in facilitating cybercrimes. The platform has processed over $49 billion in cryptocurrency transactions since 2021, far exceeding previous reports.
Huione Guarantee operates as a peer-to-peer (P2P) marketplace that connects buyers and sellers, often through Telegram handles. Many transactions on the platform involve illicit activities, including pig butchering, investment fraud, and money laundering.
The on-chain analysis reveals that Huione Pay has been active on Ethereum and TRON, with significant inflows. The platform’s connections include scams, addresses reported for stolen funds, and entities sanctioned by the Office of Foreign Assets Control (OFAC), among others.
Chainalysis’ report underscores the expansive network that Huione facilitates, linking it to larger crime syndicates and various illicit activities.
For more detailed insights, the full report can be accessed on Chainalysis.
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