Enlarge (credit: Eugene Mymrin/Getty Images)

For years, the cryptocurrency economy has been rife with black market sales, theft, ransomware, and money laundering—despite the strange fact that in that economy, practically every transaction is written into a blockchain’s permanent, unchangeable ledger. But new evidence suggests that years of advancements in blockchain tracing and crackdowns on that illicit underworld may be having an effect—if not reducing the overall volume of crime, then at least cutting down on the number of laundering outlets, leaving the crypto black market with fewer options to cash out its proceeds than it’s had in a decade.

In a portion of its annual crime report focused on money laundering that was published today, cryptocurrency-tracing firm Chainalysis points to a new consolidation in crypto criminal cash-out services over the past year. It counted just 915 of those services used in 2022, the fewest it’s seen since 2012 and the latest sign of a steady drop-off in the number of those services since 2018. Chainalysis says an even smaller number of exchanges now enable the money-laundering trade of cryptocurrency for actual dollars, euros, and yen: It found that just five cryptocurrency exchanges now handle nearly 68 percent of all black market cash-outs.

Enlarge / Holding up corporations, utilities, and hospitals for malware-encrypted data used to be quite profitable. But it's a tough gig lately, you know? (credit: ifanfoto/Getty Images)

Two new studies suggest that ransomware isn't the lucrative, enterprise-scale gotcha it used to be. Profits to attackers' wallets, and the percentage of victims paying, fell dramatically in 2022, according to two separate reports.

Chainalysis, a blockchain analysis firm that has worked with a number of law enforcement and government agencies, suggests in a blog post that based on payments to cryptocurrency addresses it has identified as connected to ransomware attacks, payments to attackers fell from $766 million in 2021 to $457 million last year. The firm notes that its wallet data does not provide a comprehensive study of ransomware; it had to revise its 2021 total upward from $602 for this report. But Chainalysis' data does suggest payments—if not attacks—are down since their pandemic peak.

Chainalysis' data from ransomware wallets suggests a marked decrease in payments to attackers last year—though the number of attacks may not have declined so markedly. (credit: Chainalysis)

Chainalysis' post also shows attackers switching between malware strains more quickly, and more known attackers are keeping their funds in mainstream cryptocurrency exchanges instead of the illicit and funds-mixing destinations that were more popular in ransomware boom times. This might look like a sign of a mature market with a higher cost of entry. But there's more to it than typical economics, Chainalysis suggests.