TLDR
- The year 2024 saw a 40% rise in pig butchering crypto scam revenue with a notable 210% surge in the number of deposits, even though individual deposit values have plunged by 55%.
- Fraudsters are branching out, combining quick-turnaround employment fraud with their usual romance scam strategies.
- Since 2021, the Huione Guarantee platform has managed $70 billion in cryptocurrency, establishing itself as a central figure in scam operations.
- There was a staggering 1900% rise in AI service vendor revenue on the Huione platform in 2024, underscoring the escalating application of AI in scam activities.
- A variety of scam types contributed to an aggregate loss of at least $9.9 billion in the crypto world during 2024.
Cryptocurrency fraudsters intensified their efforts in 2024. With pig butchering scams at the forefront, there's been a 40% uptick in their revenue compared to the previous year, as reported by blockchain analytics company Chainalysis. Chainalysis highlights a remarkable 210% rise in deposits into pig butchering scam accounts, coupled with a 55% drop in the average deposit size. This shift hints at a strategy of casting a wider net with smaller individual captures rather than pursuing high-value targets.
Named for the technique of 'fattening up' victims before making off with their funds, pig butchering scams typically begin with romance fraud, where scammers build a rapport with their targets before persuading them to invest fraudulently. Though traditionally operating out of centers in Southeast Asia, Chainalysis notes the spread of these scams to other parts of the globe. Adaptations in 2024 included scammers using fraudulent work-from-home job offers, providing quicker returns than the typical romance angle, albeit with lesser individual gains.
The surge in scam endeavors aligns with Huione Guarantee's rise as a pivotal platform for crypto-related fraudulent activities. Linked with the Cambodian corporate entity Huione Group, this peer-to-peer marketplace has facilitated $70 billion in crypto trades since 2021.
According to Chainalysis, Huione Guarantee has effectively become a 'one-stop-shop' for fraudsters, offering resources like targeted data lists, web hosting, social media profiles, and AI tools. In 2024 alone, scam operators on this platform amassed a minimum of $375.9 million in cryptocurrency.
There was a colossal 1900% surge in income for AI service providers on the Huione platform, indicating an expanding reliance on artificial intelligence in executing scams. These AI services enable scammers to fabricate convincing fake images and videos to mislead victims.
Huione's data vendors also participate in trading stolen personal data. Scammers utilize this information to identify and target individuals more susceptible to their con games.
The Rise of AI Scams
The platform's influence isn't constrained to typical scam operations. Last year, North Korea's Lazarus hacking group reportedly channeled over $150,000 in cryptocurrency through Huione’s payment system, as per Reuters.
In addition to pig butchering, there was growth in other cryptocurrency scam types in 2024. Revenues from crypto drainers climbed 170%, with a 75% boost in deposits. Address poisoning scams, which aim at users with significant wallet holdings, skyrocketed by 15,000% following a significant breach in May.
High-yield investment scams continue to be the largest subgroup, capturing 50.2% of all fraudulent deposits, while pig butchering scams accounted for 33.2%.
Cryptocurrency scams in 2024 inflicted accrued damages amounting to at least $9.9 billion, though Chainalysis anticipates this figure to rise as more scam operations are unearthed.
Scammers are employing increasingly advanced technology platforms to perpetrate frauds and launder illicit funds. The fusion of AI capabilities, pilfered data, and established networks through platforms akin to Huione Guarantee has birthed an interconnected system that's progressively expanding.
The alterations in deposit trends hint at a broader industry strategy shift. Scammers appear to be veering away from protracted schemes requiring victim grooming, favoring higher volume, less valued approaches instead.
This proliferation coincides with efforts from blockchain intelligence firms and law enforcement agencies to trace and combat crypto-centered fraud. Nonetheless, the advent of AI and other sophisticated technologies introduces new hurdles for detection and prevention strategies.
Huione Group has yet to issue a comment regarding its platform’s purported involvement in facilitating these fraudulent activities.
Maisie boasts extensive experience in reporting on Crypto & Financial news, with contributions to Moneycheck.com, level-up-casino-app.com, and Computing.net while also serving as the Editor in Chief at Blockfresh.com.
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