Of all funds sent to illegal cryptocurrency addresses from Eastern Europe, fraud attracts the largest amount, according to a new report. In the past year alone, crypto addresses based in the region have given the fraudulent systems an unbelievable $ 815 million in crypto.

Eastern Europe leads by volume of illegal crypto transactions

Among the regions of the world with a total volume of crypto transactions of at least $ 400 million, Eastern Europe is the only one where illegal activity exceeds 0.5% of total value sent and received, notes Chainalysis in a preview of its Geography of Cryptocurrency 2021 report . In a blog post published on Wednesday, the blockchain forensics company revealed:

Between June 2020 and July 2021, Eastern European addresses sent $ 815 million in fraud, second only to Western Europe.

Crypto addresses in Eastern European countries have the second highest exposure to illegal addresses, with Africa at the top of the table and Latin America in third place, according to the excerpt. However, Eastern Europe has a much larger cryptocurrency economy overall than any of the other regions in the top 3.

Eastern Europe is sending over $ 800 million in crypto to scammers in a single year, the report revealsSource: chain analysis

Researchers also note that Eastern Europe was responsible for most of the web traffic to fraudulent websites during the period studied. Of all the nations, Ukraine is the clear leader with more than double the number of web visits registered in the United States, which is by far in second place. The total number of monthly Eastern European visitors to crypto scam sites peaked at 12.5 million in January.

Eastern Europe is sending over $ 800 million in crypto to scammers in a single year, the report revealsSource: chain analysis

While Eastern Europe sends more digital currencies than other regions to darknet markets like the Hydra Market, which targets the Russian-speaking world, scams get the largest share of Eastern European crypto funds sent to illegal addresses, Chainalysis concludes. “We can assume that most of these activities involve victims sending money to fraudsters,” the report’s authors point out.

Finiko Ponzi Scheme collects over $ 1.5 billion worth of Bitcoin in 2 years

Chainalysis further notes that over half of the value sent to fraudulent addresses in Eastern Europe went to a specific scam based in the Russian Federation – Finiko. The Ponzi scheme, which lured crypto investors promising monthly returns of up to 30%, collapsed in July after receiving more than $ 1.5 billion worth of Bitcoin (BTC) since December 2019, mainly by Russian and Ukrainian crypto holders.

Eastern Europe is sending over $ 800 million in crypto to scammers in a single year, the report revealsSource: chain analysis

According to Russian media, Finiko was led by Kirill Doronin, an Instagram influencer who is also linked to other Ponzi schemes. As incomes fell due to the aggravated economic hardship caused by the coronavirus pandemic, the scam targeted people in need of extra money. Many Russians fell for the financial pyramid scheme as they did in the “wild 1990s”.

Meanwhile, the officially estimated damage in the Finiko case has reached 250 million rubles (over $ 3.4 million), Forklog reported. The crypto news agency cited the latest version of the indictment against the founder of the pyramid in the Russian Republic of Tatarstan. Independent experts claim the total losses exceed $ 4 billion. So far 80 people have been identified as victims of the fraud, although the number of depositors is estimated to be at least 850,000.

What do you think of the results of the Chainalysis report? Let us know in the comments section below.

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