The U.S. witnessed a staggering 53% increase in losses from cryptocurrency investment scams in 2023, reaching a total of $3.94 billion, according to a recent report by the Federal Bureau of Investigation (FBI).
What Happened: The FBI’s Internet Crime Report 2023 revealed that the total losses from scams related to crypto, such as Bitcoin BTC/USD, Dogecoin DOGE/USD and Shiba Inu SHIB/USD, in 2023 rose to $3.94 billion, marking a 53% increase from the previous year’s $2.57 billion, Coindesk reported.
The report also brought to light that the overall investment frauds saw a 38% increase, reaching $4.57 billion from $3.31 billion. The majority of these frauds were cryptocurrency scams, emphasizing the significant role that digital currency has in online crime.
The FBI report noted, “Fraudsters are increasingly using custodial accounts held at financial institutions for cryptocurrency exchanges or third-party payment processors, or having targeted individuals send funds directly to these platforms where funds are quickly dispersed.”
Internet crime was dominated by investment scams in 2023, accounting for over a third of the total $12.5 billion in losses, as per the FBI report.
Why It Matters: The surge in crypto scams in 2023 can be seen in the context of several significant events.
In January, Germany seized over $2 billion in Bitcoin from piracy proceeds, marking the largest seizure of Bitcoins by law enforcement in the country. The operation was carried out in collaboration with the FBI.
Earlier that same month, the U.S. government announced its intention to sell off $132.5 million in Bitcoin that was seized in connection with the Silk Road scam investigation.
Moreover, in September, JP Morgan Chase & Co. decided to halt cryptocurrency-related transactions for its U.K. clients, indicating the growing concern of financial institutions over crypto-related crimes.
Read Next: Bitcoin, Ethereum, Dogecoin Rise As Investors Buy The Dip
Disclaimer: This content was partially produced with the help of Benzinga Neuro and was reviewed and published by Benzinga editors.
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