Chainalysis Claims 64% of Ransomware Attacks involving Money Laundering are Executed via Crypto Exchanges

June 1, 2019 By: Nwabundo Wisdom

 

An American-based blockchain intelligence firm, Chainalysis, has disclosed in a webminar it organised on May 30, that drawing from data gathered, 64% of ransomware attacks are targeted at crypto exchanges which are seen as a cash-out mediums for acquiring ill gotten funds.

Ransomware attack is an act mostly carried out by hackers, who through the use of a malware infects a targeted account, thereby denying their victims access to their data until a ransom is paid. This ransom is often paid using cryptocurrency, after which the targeted victims are granted access to their data.

A number of exchanges, specifically 38 of them have been identified (though names withheld) by Chainalysis as victims of ransomware attacks. Chainalysis is able to perform this function due to the fact that its sole objective is to provide businesses, government agencies and others with analytical tools to monitor and track blockchain transactions in suspected cases of illicit activities.

It is on this basis- from data gathered that, Chainalysis, claims 64% of ransomware attacks are targeted at crypto exchanges through which these attackers launder funds. Analysis from, Chainalysis, also states that ransomware attacks are more and often carried out on less-complex cash-out networks other than crypto exchanges, as hacks on crypto exchanges involves laundering of huge amounts of funds, high publicity by various media outlets and discretely controlling the movement of funds.

Ransomeware attacks on the otherhand, involve laundering of little funds which can be discretely moved through multiple addresses, attract less attention and investigation by law enforcement agencies. However, recent development have seen a shift in ransomware attacks from less complex networks and victims with less popularity to victims with legal and politically sensitive data while ransoms have also been increased.

Coveware’s Q1 2019 Global Ransomware Marketplace in a report revealed that 98% of crypto payments demanded by ransomware attacks are made using Bitcoin- which accounts for the lion’s share. In addition, the reports also stated that ransom payments have increased to 89% from a median $6,733 in Q4 2018 to $12,762 in Q1 2019 which is in line with the report from Chainalysis.

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