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Fraudsters’ Revenue from Pig-Butchering Schemes Reaches Record $12.4 Billion in 2024
Crypto scammers may have pocketed as much as a record $12.4 billion last year, fueled in part by the growth of so-called pig-butchering schemes, according to blockchain analytics firm Chainalysis.
Fraudsters’ revenue from such schemes, in which they build up victims’ trust before convincing them to make fraudulent crypto investments and named after the practice of fattening swine before slaughter, rose 40% to at least $9.9 billion.
Scammers Refine Tactics, Leverage AI and Expand Networks
While law enforcement agencies worldwide have targeted such operations, scammers have refined their tactics, Chainalysis said. The scammers leverage artificial intelligence and are expanding their networks across multiple countries, becoming more professionalized, the report said. Overall, scam activity has increased 24% on average since 2020.
Pig-Butchering Schemes: A Growing Concern
Chainalysis highlighted platforms like Huione Guarantee, a peer-to-peer marketplace that functions as a “one-stop-shop” for scammers’ needs. Those services include money laundering, social media management, or selling data, among others. According to Chainalysis, Huione Guarantee received at least $375.9 million in cryptocurrency in 2024.
How Scams Work
Fraudsters direct victims to fake investment platforms, convincing them to send funds to wallets they control. Once the money is transferred, victims are unable to withdraw it, and scammers disappear.
Challenges in Combating Crypto-Related Fraud
While authorities have made progress in tracking and shutting down fraudulent operations, the sheer volume of scams shows the challenges ahead. With the continued rise of AI-powered deception, Chainalysis warns that more aggressive countermeasures may be needed to curb crypto-related fraud.
- What is a pig-butchering scheme?
- How did Chainalysis arrive at the $12.4 billion figure?
- What are some common tactics used by scammers in pig-butchering schemes?
- How can individuals protect themselves from falling victim to these schemes?
- What measures can law enforcement agencies take to combat crypto-related fraud?
Conclusion
The growth of pig-butchering schemes and other forms of crypto-related fraud is a significant concern for individuals and law enforcement agencies alike. As scammers continue to refine their tactics and leverage AI, it is crucial that we develop more effective countermeasures to combat these schemes. By staying informed and taking proactive steps to protect ourselves and others, we can work together to mitigate the impact of these scams and promote a safer online environment.
FAQs
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What is a pig-butchering scheme?
A pig-butchering scheme is a type of fraud in which scammers build up victims’ trust before convincing them to make fraudulent crypto investments. The term is derived from the practice of fattening swine before slaughter. -
How did Chainalysis arrive at the $12.4 billion figure?
Chainalysis arrived at the $12.4 billion figure by analyzing data from various sources, including blockchain transactions and other digital assets. The company’s report highlights the growth of pig-butchering schemes and other forms of crypto-related fraud. -
What are some common tactics used by scammers in pig-butchering schemes?
Scammers use a range of tactics to deceive victims, including building trust, creating fake investment opportunities, and using social media to spread false information. -
How can individuals protect themselves from falling victim to these schemes?
Individuals can protect themselves from falling victim to these schemes by being cautious when engaging in online transactions, verifying the authenticity of investment opportunities, and staying informed about the latest scams and trends. - What measures can law enforcement agencies take to combat crypto-related fraud?
Law enforcement agencies can combat crypto-related fraud by working with blockchain analytics firms, monitoring transactions, and shutting down fraudulent operations. Additionally, they can educate the public about the risks and warning signs of these schemes.
