Crypto thefts, fraud hit $1.2 billion in Q1 report

[akeegan]

Can you believe that losses from the theft of crypto from exchanges due to fraud hit $1.2B?

https://www.reuters.com/article/us-crypto-currency-fraud/cryptocurrency-thefts-fraud-hit-1-2-billion-in-first-quarter-report-idUSKCN1S62P3

I still can't wrap my mind around why people wouldn't want to have compliance with AML and KYC to better help that this doesn't happen

[1715698724]

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[1715698724]

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[XinXan]

Don't think that normal businesses have no fraud, they also steal hundreds of millions, banks do it, businesses of all types do it, investment businesses do it. Just because the headlines are like that for crypto it doesn't mean it only happens here. There is MASSIVE fraud out there not involving crypto, billions and billions of dollars, if we knew the real figure it would make the 1.2b seem like dust.

[dothebeats]

I think it's way more than that to be honest, as there had been some thefts that are not publicized or are not being made public e.g. personal wallets, unknown exchanges/services etc. One cannot easily contain thefts as long as there are insecure platforms and personal vaults, so I don't think it's that surprising to know that such things exist in the cryptosphere, though somewhat more prevalent and frequent compared to banks, I should say (or perhaps 'more publicized' is more fitting?) Anyway, expect that number to rise as long as there are exploits to capitalize on. Sure enough, there'd be loads of thefts to follow as bitcoin and crypto is also considered money and it's gaining traction again after a few years.

[figmentofmyass]

Can you believe that losses from the theft of crypto from exchanges due to fraud hit $1.2B?

https://www.reuters.com/article/us-crypto-currency-fraud/cryptocurrency-thefts-fraud-hit-1-2-billion-in-first-quarter-report-idUSKCN1S62P3

I still can't wrap my mind around why people wouldn't want to have compliance with AML and KYC to better help that this doesn't happen

let's give this some context. chargebacks and chargeback fraud alone costs e-commerce merchants $40 billion per year now.

so a rate of $5 billion/year doesn't seem that crazy for crypto theft and fraud. bitcoins cost more than $5k a pop---we're in the big leagues now.

[Leonardo7]

What we need is actually a high-class cryptocurrency exchange with the best possible security measures in place. Tokenpay team is said to be building an unhackable dex with their Efin coin. I hope to see truely unhackage exchnage, users too need to be careful with their details and not cheaply fall for a scam as we had with the scamming ethereum classic Vision that stole people private keys out of ignorance and lack of research.

[pooya87]

that is what happens when you combine decentralization with centralization while having no regulations in the centralized field! most of these cases are the exchanges scamming their users that easily and a lot of it is not even recorded.
what we need to do is to stick to decentralization and try to develop better decentralized exchanges, decentralized market place,... and eliminate the centralized point of failure that currently is causing all these thefts.

[Erickan]

Don't think that normal businesses have no fraud, they also steal hundreds of millions, banks do it, businesses of all types do it, investment businesses do it. Just because the headlines are like that for crypto it doesn't mean it only happens here. There is MASSIVE fraud out there not involving crypto, billions and billions of dollars, if we knew the real figure it would make the 1.2b seem like dust.

There are no professions and fields that do not exist fraud and scam. In comparison, traditional economic sectors such as finance, industry and services have a huge percentage of frauds compared to crypto. You think which currency is used to make the world's most money-laundering, inflation, and fraud tool. Yes it is fiat, namely USD, not something else. They are just exaggerating the news about crypto and turning it into a kind of money for criminals.

[Anonylz]

To be honest, am not surprise at this number because the rate at which you hear different tales of exchanges been hacked is quite alarming, i wonder why it's so - should i say easy to breach the securities of this exchanges, not to mention the countless scam project we have this days that have walked away with millions of investors funds,
Can't say regulations would be the ultimate solution because some of the more regulated sectors do faces such as well, but it will give a bit of control in the crypto space.

[Genemind]

I guess it's the right time for every exchange to add more restrictions and security. We can't question is there are lots of exchanges who are requiring Kyc. Everything online is hackable so we must submit and comply with the requirements to at least lessen the crime rate.

[Kakmakr]

Let's expose this bullshit! - "In the first quarter of 2019, theft of digital currencies from exchanges and scams totaled $356 million, while losses from fraud or misappropriated funds amounted to $851 million, the respected U.S.-based CipherTrace said in a quarterly report.

So what Reuters have done, is to add the supposed Bitfinex amount as misappropriated funds, which has not been proven and created a clickbait article with massive amounts of fraud and theft to put Bitcoin in a bad light. <The amount used in the Bitfinex/Tether witch-hunt is $850 Million>  

This is a US government and media concocted witch-hunt to scare people away from Crypto currencies. 

[Haunebu]

Let's expose this bullshit! - "In the first quarter of 2019, theft of digital currencies from exchanges and scams totaled $356 million, while losses from fraud or misappropriated funds amounted to $851 million, the respected U.S.-based CipherTrace said in a quarterly report.

So what Reuters have done, is to add the supposed Bitfinex amount as misappropriated funds, which has not been proven and created a clickbait article with massive amounts of fraud and theft to put Bitcoin in a bad light. <The amount used in the Bitfinex/Tether witch-hunt is $850 Million>  

This is a US government and media concocted witch-hunt to scare people away from Crypto currencies. 

Damn. This makes complete sense. The extent to which the media goes to grab attention by demeaning BTC is astounding. These guys continue to scare away more and more investors which is why the adoption rate is slowing down.

The good thing is that more and more people are realizing that majority of the stuff that media churns out are rumors and gossip and nothing more.

[Beerwizzard]

It seems like a couple points are still a bit questionable:
1. Almost all major exchanges are requiring to set any kind of 2fa as a part of their verification process. So how could someone steal their money?
2. If this $1.2B were stolen from unpopular exchanges then how we can be sure that this data they provided is legit? Maybe exchange administration stole user's money and claim that was a hack.

[carter34]

Not suppressing at the figure because I have witnessed some experience where I have recorded lost tokens and couldn't know what went wrong. I only let go because you can't get justice to that as far as I know.

[XinXan]

Don't think that normal businesses have no fraud, they also steal hundreds of millions, banks do it, businesses of all types do it, investment businesses do it. Just because the headlines are like that for crypto it doesn't mean it only happens here. There is MASSIVE fraud out there not involving crypto, billions and billions of dollars, if we knew the real figure it would make the 1.2b seem like dust.

There are no professions and fields that do not exist fraud and scam. In comparison, traditional economic sectors such as finance, industry and services have a huge percentage of frauds compared to crypto. You think which currency is used to make the world's most money-laundering, inflation, and fraud tool. Yes it is fiat, namely USD, not something else. They are just exaggerating the news about crypto and turning it into a kind of money for criminals.

There are individuals out there that have stolen more money alone than in the whole crypto space. Obviously criminals have existed and done this since forever, long before bitcoin existed, just like terrorists had enough funding long before any kind of cryptocurrency existed, these headlines are just clickbait, exaggeration to attract viewers.

[fndsr]

I am also concerned about the current situation, something that has value is definitely an easy target for thieves to seize other people's assets, let's all save our assets properly to be safer from theft

[nauane]

Don't think that normal businesses have no fraud, they also steal hundreds of millions, banks do it, businesses of all types do it, investment businesses do it. Just because the headlines are like that for crypto it doesn't mean it only happens here. There is MASSIVE fraud out there not involving crypto, billions and billions of dollars, if we knew the real figure it would make the 1.2b seem like dust.

There are no professions and fields that do not exist fraud and scam. In comparison, traditional economic sectors such as finance, industry and services have a huge percentage of frauds compared to crypto. You think which currency is used to make the world's most money-laundering, inflation, and fraud tool. Yes it is fiat, namely USD, not something else. They are just exaggerating the news about crypto and turning it into a kind of money for criminals.

There are individuals out there that have stolen more money alone than in the whole crypto space. Obviously criminals have existed and done this since forever, long before bitcoin existed, just like terrorists had enough funding long before any kind of cryptocurrency existed, these headlines are just clickbait, exaggeration to attract viewers.

Are the banks not robbed every day ? Do the thief not stole people belongings on the daily basis ? Sometimes i feel that the crypto fraud news are sent with the intention of bring the bitcoin price down, maybe for the benefit of the whale and for the panic seller of the retail investors  

[rmilly]

Let's expose this bullshit! - "In the first quarter of 2019, theft of digital currencies from exchanges and scams totaled $356 million, while losses from fraud or misappropriated funds amounted to $851 million, the respected U.S.-based CipherTrace said in a quarterly report.

So what Reuters have done, is to add the supposed Bitfinex amount as misappropriated funds, which has not been proven and created a clickbait article with massive amounts of fraud and theft to put Bitcoin in a bad light. <The amount used in the Bitfinex/Tether witch-hunt is $850 Million>  

This is a US government and media concocted witch-hunt to scare people away from Crypto currencies. 

Just had a look into the entire report released by ciphertrace. Do you still think that this is to scare people from crypto or just a means to better help compliance? https://ciphertrace.com/wp-content/uploads/2019/05/ciphertrace-q1-2019-cryptocurrency-anti-money-laundering-report.pdf

[okala]

They have been widespread of financial fraud all over the world economy and even the banking sector and all other financial institutions are all facing this same problem of fraud if it not hacking into exchange it will be laundering of money from one country to another. And how are we sure that kyc will solve the problem of insecurity of crypto assets because the hacker can still hack any exchange even with full kyc process in place, all that we should work towards is for exchanges to upgrade they security softwares in other to prevent hack. $1.2 billion is huge.

[vycl87]

Crypto assets have been stolen for years. But it seems to me that this year, there was less interference than in previous years.

I think exchanges have to be more careful because of the investment amount is getting bigger day by day.

[Slow death]

Can you believe that losses from the theft of crypto from exchanges due to fraud hit $1.2B?

https://www.reuters.com/article/us-crypto-currency-fraud/cryptocurrency-thefts-fraud-hit-1-2-billion-in-first-quarter-report-idUSKCN1S62P3

I still can't wrap my mind around why people wouldn't want to have compliance with AML and KYC to better help that this doesn't happen

one of the things that makes me very angry and disappointed with this cases of hackers is that the thieves are never found and punished. different from real life where there are many chances of thieves being found and punished. We need laws, we need governments to inspect the exchanges. we need to have responsible exchanges and there is another question: how are the people who lost their funds in the exchanges will be compensated?

[ccryptopark]

Can you believe that losses from the theft of crypto from exchanges due to fraud hit $1.2B?

https://www.reuters.com/article/us-crypto-currency-fraud/cryptocurrency-thefts-fraud-hit-1-2-billion-in-first-quarter-report-idUSKCN1S62P3

I still can't wrap my mind around why people wouldn't want to have compliance with AML and KYC to better help that this doesn't happen

one of the things that makes me very angry and disappointed with this cases of hackers is that the thieves are never found and punished. different from real life where there are many chances of thieves being found and punished. We need laws, we need governments to inspect the exchanges. we need to have responsible exchanges and there is another question: how are the people who lost their funds in the exchanges will be compensated?

I agree with you. I think as the technology starts to improve it does so on both ends. Both crypto and cyber security. I think that teams like ciphertrace are on the right path to find these people and operations

[jjbanks994]

I am curious to see what will happen compliance of privacy coins because isn't this report just public ledgers?

[tomahawk9]

1.2 billion is nothing compared to other industries.

According to TransUnion, back in 2016 the E-commerce market lost 7 billion dollars because of fraud in the US, a figure that it's expected to reach over 30 billion dollars by next year[1]. But the mainstream media won't say anything about this, the guys pulling the strings behind the scenes in these news sites only want the general public to have a negative perception on cryptos...Bastards.

1. https://www.transunion.com/blog/trends-in-retail-fraud-what-you-need-to-know

[jakezyrus]

1.2 billion is nothing compared to other industries.
According to TransUnion, back in 2016 the E-commerce market lost 7 billion dollars because of fraud in the US, a figure that it's expected to reach over 30 billion dollars by next year.

Wow thats a huge amount of sums being stole by criminals but thats normal for other industries because they also have a huge market cap while here on cryptocurrencies ,  our market cap is only small and if billions are being stole , that is already bothering  .

But the mainstream media won't say anything about this, the guys pulling the strings behind the scenes in these news sites only want the general public to have a negative perception on cryptos...Bastards.

News or news sites or even any other people can give their own opinion . they create an article whether legit or hoax but thats normal.  There are good news and there are bad news on crypto  but we a real crypti user will understand that crypto is not a currency that being used by fraudsters  . crypto is not a dangerous currency  .

[chaoscoinz]

Can you believe that losses from the theft of crypto from exchanges due to fraud hit $1.2B?

https://www.reuters.com/article/us-crypto-currency-fraud/cryptocurrency-thefts-fraud-hit-1-2-billion-in-first-quarter-report-idUSKCN1S62P3

I still can't wrap my mind around why people wouldn't want to have compliance with AML and KYC to better help that this doesn't happen

With new financial technological innovations there will always be those who are looking to exploit the usage rather than support the movement. It just comes with the territory. The more Blockchain finacial tech evolves, the more elaborate the schemes and scams will become.

[MMS2017]

Crypto theft and frauds become more familiar in the present time and due to digital world the online transfer become very risky for us. Hackers can easily hack accounts and with in a couple of minutes you can loss everything. Crypto is good to have but with it risk is also involved.

[XinXan]

1.2 billion is nothing compared to other industries.

According to TransUnion, back in 2016 the E-commerce market lost 7 billion dollars because of fraud in the US, a figure that it's expected to reach over 30 billion dollars by next year[1]. But the mainstream media won't say anything about this, the guys pulling the strings behind the scenes in these news sites only want the general public to have a negative perception on cryptos...Bastards.

1. https://www.transunion.com/blog/trends-in-retail-fraud-what-you-need-to-know

Dude, Bernard Madoff alone stole $65 billion with his Ponzi scheme and that's just one single individual, fraud happens everywhere, it's not really easier to do it in crypto.

[Meysa_richa]

I don't believe in deception like that, and I think that KYC is really needed and can help us become problematic identities.

[BrewMaster]

it is interesting to know that although the number here looks huge but it is a total of a much smaller number of theft cases. in other words the sum is big not the count. for example every time you see an exchange is hacked they lost millions of dollars but when a user is hacked he loses $500, $1000 and smaller amounts. and the number of exchange hacks is big enough to overshadow the user losses.
that makes you think about where the problem comes from...

[Johnzky]

I guess it's the right time for every exchange to add more restrictions and security. We can't question is there are lots of exchanges who are requiring Kyc. Everything online is hackable so we must submit and comply with the requirements to at least lessen the crime rate.

But the essence of being decentralized and anonymous will be gone?people here arw not complying in KYC requirements because they want to retained their anonymity and if this will happen then what is the difference of cryptocurrency to banking.networm?yes a believed there's a high security that must happen here but its not just about kyc,because some of ths hackings are insidr jobs if they are not all

[buwaytress]

Don't be mad at the hackers, hackers be doing what hackers do. Thieves be doing what thieves do. Be mad at the exchanges who practise poor security. The report confirms what we've always known, that most of these hacks were only possible because of simple negligence on the part of exchanges. Just because they're "crypto" they're allowed to get away with being lazy when it comes to security. Normal companies have to do audits, but apart from maybe Coinbase and those Japan licensed ones, exchanges can operate these days without any kind of auditing, much less practice compliance. But hey, as long as they can launch IEOs, they're fine, right?

[Anomrak]

Can you believe that losses from the theft of crypto from exchanges due to fraud hit $1.2B?

https://www.reuters.com/article/us-crypto-currency-fraud/cryptocurrency-thefts-fraud-hit-1-2-billion-in-first-quarter-report-idUSKCN1S62P3

I still can't wrap my mind around why people wouldn't want to have compliance with AML and KYC to better help that this doesn't happen

one of the things that makes me very angry and disappointed with this cases of hackers is that the thieves are never found and punished. different from real life where there are many chances of thieves being found and punished. We need laws, we need governments to inspect the exchanges. we need to have responsible exchanges and there is another question: how are the people who lost their funds in the exchanges will be compensated?

In most case the hacked service try to refund the customers. I think very few are covered by theft insurrance, they usually have fund reserves for that, but it's a confidential information for them.

As an exchange customer I'll be very interested for contracts terms and conditions saying your fund are covered from theft up to xxxx $.

For me the best thing will be law forcing exchanges or any crypto services with assets custody to cover customer funds. For example in France (and I think in all Euro zone), each bank providing accounts must cover funds up to 100 K€ per persons.

[darylalban]

Don't be mad at the hackers, hackers be doing what hackers do. Thieves be doing what thieves do. Be mad at the exchanges who practise poor security. The report confirms what we've always known, that most of these hacks were only possible because of simple negligence on the part of exchanges. Just because they're "crypto" they're allowed to get away with being lazy when it comes to security. Normal companies have to do audits, but apart from maybe Coinbase and those Japan licensed ones, exchanges can operate these days without any kind of auditing, much less practice compliance. But hey, as long as they can launch IEOs, they're fine, right?

I don't agree with you. I think there are exchanges that are doing as much as they can to handle AML and KYC compliance. The report in this thread is generated by a leading cyber security firm Ciphertrace who just partnered with Binance. They're leading the charge with proper auditing I think

[kingpin4321]

Those figures are very high and this would only prove that fraudulent activities in cryptocurrency are on the increase and there is a need for stronger security measures put in place

[rjp55]

1.2 billion dollars just in 2019 first quarter? That seems like too much. I feel they are exaggarating number to get more interest to this story. At least i hope so.

[CryptoBry]

Don't think that normal businesses have no fraud, they also steal hundreds of millions, banks do it, businesses of all types do it, investment businesses do it. Just because the headlines are like that for crypto it doesn't mean it only happens here. There is MASSIVE fraud out there not involving crypto, billions and billions of dollars, if we knew the real figure it would make the 1.2b seem like dust.

Frauds are everywhere online and offline and this is one big reality the modern world is facing. There are now more fraudsters, hackers, scammers, thieves and similar people than any other time in human history. The snake that pushed Eve to ate the other tree in the garden had produced so many offspring and they are now populating the world...and right they are getting in love with cryptocurrency as the possible stakes are really good. Hell, even North Korea is also taking a big slice of the pie on the stealing market. The only reason why loss in the world of cryptocurrency can always land in the news is because cryptocurrency is something new (in comparison to the fiat system) and something new can always arouse more eyeballs.

[traderethereum]

1.2 billion dollars just in 2019 first quarter? That seems like too much. I feel they are exaggarating number to get more interest to this story. At least i hope so.

We don't know if that number is true or not but I think that is a prediction number that has been lost so far. I think we need to be careful to protect our account and let the thief stolen the coins we have.
Although they are trying to do many ways to get the coins, as long as we can protect and don't panic with what happens in the market, we could prevent from the loss because of the thief.
I think in Q2 and next, they will still trying to steal more crypto, and they will search in the other exchange and make those exchange as their next target.

[rmilly]

1.2 billion dollars just in 2019 first quarter? That seems like too much. I feel they are exaggarating number to get more interest to this story. At least i hope so.

I thought that too but if you think about the possible exit scam Quadriga and other scams found in other countries it definitely adds up. I doubt that they would just pick a random number to use for media purposes. They use that high number for sure in the title to capture everyone's attention but it is alarming

[buwaytress]

Don't be mad at the hackers, hackers be doing what hackers do. Thieves be doing what thieves do. Be mad at the exchanges who practise poor security. The report confirms what we've always known, that most of these hacks were only possible because of simple negligence on the part of exchanges. Just because they're "crypto" they're allowed to get away with being lazy when it comes to security. Normal companies have to do audits, but apart from maybe Coinbase and those Japan licensed ones, exchanges can operate these days without any kind of auditing, much less practice compliance. But hey, as long as they can launch IEOs, they're fine, right?

I don't agree with you. I think there are exchanges that are doing as much as they can to handle AML and KYC compliance. The report in this thread is generated by a leading cyber security firm Ciphertrace who just partnered with Binance. They're leading the charge with proper auditing I think

You missed my point. KYC and AML is for regulatory compliance... as the terms both suggest, so that they know who their customers are and can help prevent money laundering. This is to stop bad guys from misusing these services to transfer finances for terrorism, for example. Nothing to do with how thefts and fraud cause people to lose their funds at these exchanges. You can KYC and AML to death but if you don't have good security, then your funds are at risk of being stolen by hackers.

This is exactly what I mean by a poor understanding of how crypto is stolen.

[Umkar]

This is really a huge amount, especially since it is only for the first quarter of 2019. I think that is why many investors are in no hurry to invest and are waiting for official regulation and relevant laws that will allow insurance companies, banks and other financial organizations to come into this business.  With the start of regulation and insurance, cryptocurrencies should become safer for investors.

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[ccryptopark]

This is really a huge amount, especially since it is only for the first quarter of 2019. I think that is why many investors are in no hurry to invest and are waiting for official regulation and relevant laws that will allow insurance companies, banks and other financial organizations to come into this business.  With the start of regulation and insurance, cryptocurrencies should become safer for investors.

I know Mike Novogratz is one investor in particular who is a huge proponent for compliance and regulation using third party firms to help with AML and KYC. It makes sense for them to feel their funds secure and not getting scammed

[XinXan]

Don't think that normal businesses have no fraud, they also steal hundreds of millions, banks do it, businesses of all types do it, investment businesses do it. Just because the headlines are like that for crypto it doesn't mean it only happens here. There is MASSIVE fraud out there not involving crypto, billions and billions of dollars, if we knew the real figure it would make the 1.2b seem like dust.

Frauds are everywhere online and offline and this is one big reality the modern world is facing. There are now more fraudsters, hackers, scammers, thieves and similar people than any other time in human history. The snake that pushed Eve to ate the other tree in the garden had produced so many offspring and they are now populating the world...and right they are getting in love with cryptocurrency as the possible stakes are really good. Hell, even North Korea is also taking a big slice of the pie on the stealing market. The only reason why loss in the world of cryptocurrency can always land in the news is because cryptocurrency is something new (in comparison to the fiat system) and something new can always arouse more eyeballs.

I doubt there are ''more'' fraudsters now than before. The biggest difference is the ability to conduct frauds now vs before. Clearly it's much easier now because you have the benefit of anonymity and massive reach through the internet. Hundreds of years ago it was much harder to conduct any type of fraud and you needed a lot of creativity to do it but I'm sure if anyone had access to do it, a lot more people would have done it than compared to now.

[DatKing]

It is very frustrating that cryptocurrencies have serious security problems. They still can't do much against this crypto theft affairs. $1.2 billion is a scaring value. I hope they can improve their security system as soon as possible.

[erikalui]

Compliance with KYC/AML is not the problem but these exchanges despite of having to deal with billions of dollars, they choose not to have theft insurance or may be they have but don't declare it and ultimately it's the loss of customers. Also, when cold storage is proved to be secure, how can these exchanges be so weak and vulnerable to hacks? And also some exchanges DNS serves get hacked which is miserable.

[b3llsf1l3s]

Can you believe that losses from the theft of crypto from exchanges due to fraud hit $1.2B?

https://www.reuters.com/article/us-crypto-currency-fraud/cryptocurrency-thefts-fraud-hit-1-2-billion-in-first-quarter-report-idUSKCN1S62P3

I still can't wrap my mind around why people wouldn't want to have compliance with AML and KYC to better help that this doesn't happen

Well, the crypto thefts, hacking, fraud and another issues that can cause crypto seems bad to new people, i think that was beyond the scope of AML and KYC. Hacker is not that stupid, using his own or another's people account to stole exchanges assets because the exchange absolutely can track on them. That was the bad step for them. In this case the KYC and AML wouldn't work since hackers maybe just do some direct attack to those exchanges, using new address to receive.

Its just like you didn't use the door, you just break the wall to steal it. I think, recently the best way is just apply for manual processing withdrawal for huge amount

[walterhartman]

Crypto is too juicy a target for hackers to ignore.   

[JeBro]

As in any new venture, easy money lovers and various kinds of criminal elements were the first to rush in Bitcoin. It is not surprising that such large sums as more than 1,2 billion dollars are stolen by fraudsters. All the same, the blockchain technology, including bitcoin, despite all the attractiveness, remains not completely refined from a security point of view. This is due to the fact that the requirements for freedom of BTC movement intersect here and the need to track Bitcoin transactions to counter fraud.

[akeegan]

As in any new venture, easy money lovers and various kinds of criminal elements were the first to rush in Bitcoin. It is not surprising that such large sums as more than 1,2 billion dollars are stolen by fraudsters. All the same, the blockchain technology, including bitcoin, despite all the attractiveness, remains not completely refined from a security point of view. This is due to the fact that the requirements for freedom of BTC movement intersect here and the need to track Bitcoin transactions to counter fraud.

I am interested in how governments will react to these cyber security firms to help with tracking rather than getting involved themselves. I would imagine they probably hire these guys to do the search work for them

[MakeMoneyBtc]

I think we are talking about pennies here compared with fraud that other big companies do working with fiat. This is just a small piece of the puzzle and people focus on this because they want to destroy the reputation of cryptocurrencies and also because it's easier to blame something that's relatively new and still unknown by most people. There is crime, fraud and illegal activity everywhere not only in crypto area.

[thankyoulord]

It is really a pity this fraud thing is yet to come to an end. So much has been lost in recent times by investors and traders. Some are even lost through exchanges and others got their wallets hacked. We all really need to be very careful with our private keys and watch out carefully before investing in any project of our choice. Crypto theft will continue but sure we can protect ourselves from becoming a victim

[teddyelwyn]

It is really a pity this fraud thing is yet to come to an end. So much has been lost in recent times by investors and traders. Some are even lost through exchanges and others got their wallets hacked. We all really need to be very careful with our private keys and watch out carefully before investing in any project of our choice. Crypto theft will continue but sure we can protect ourselves from becoming a victim

I agree. I think these are the times that we need to innovate and think of how we can prevent these sorts of fraud before they even happen. Yes decentralized is our goal but that doesn't mean we need to continue old bad habits of how fraud plays out that's why cyber security companies that are crypto specific are necessary

[uray]

I still can't wrap my mind around why people wouldn't want to have compliance with AML and KYC to better help that this doesn't happen

You really think that the fraud is happening because of lack of AML and KYC, if that is the case you are mistaken, these compliance is for legit businesses and the fraud ICO and the hacks that happened in multiple exchanges are the root cause for these losses and it has nothing to do with other factors regarding strict compliance of KYC, so do not mix these things up.

[Adriano2010]

Yes this happen and is not good, i think people should always try to secure better their coins and hold on a hardware wallet, and if possible always not hold so much coins on an exchange or to an online site.

[akeegan]

I think that these larger exchanges that adhere to compliance aren't the ones to blame which is what it sounds like from everyone in the threads. Instead we should be putting blame on bad actors who are moving large amounts of money for illegal purposes either to steal or for illicit drugs

[ccryptopark]

I believe that 1.2 billion comes from 356 million stolen from crimals plus the 851 stolen from Bitfinex exchange

[jjbanks994]

Aww i can't  believe  on this big fraud..but may be it is truth.. but now we should take  steps to prevent this fraud.. we must do some precaution for bitcoin scam and for frauds..

I totally agree. Granted Ciphertrace who generated the report is taking the right steps for helping prevent fraud with their technology

[shield132]

Can you believe that losses from the theft of crypto from exchanges due to fraud hit $1.2B?

https://www.reuters.com/article/us-crypto-currency-fraud/cryptocurrency-thefts-fraud-hit-1-2-billion-in-first-quarter-report-idUSKCN1S62P3

I still can't wrap my mind around why people wouldn't want to have compliance with AML and KYC to better help that this doesn't happen

If bittrex or binance got hacked that's not my problem, this statistics also 100% shows how garbage their security system is (behind this security system there are IT personals which seems can't do their job properly). People usually use bitcoin for two reason: 1. Privacy 2. Profit, so when privacy is my choice, I think KYC documents must be far away from it. And if fraud happens because of stupid user, that's another task.

[blackhawkeye1912]

Security is one of the real obstacles blocking the way for bitcoin to do its full capabilities. The bitcoin technology itself is great. But, the supporting platforms are the ones that having problems. The technology is too young. Developments and improvements are on-going. Though, it's sad to hear those news.

[gabbie2010]

A whooping $1.2B this is indeed massive and portrays the image of cryptos in a bad light despite all regulations, KYCs, AMLs etc I wonder how those stealings aka hacking was successfully carried out without any trace and arrest. I think its high time this problem is nip in the bud else cryptos investors, adopters, hodlers and traders will lose confidence in it. More so cryptos stakeholders should devise  a better way or method of securing cryptos permanently to avoid all these embarrassing stories of hackings and theft.

[Vishnu.Reang]

I still can't wrap my mind around why people wouldn't want to have compliance with AML and KYC to better help that this doesn't happen

The first part of your post was OK. But the second part shows your complete ignorance towards the basics of cryptocurrency. How KYC is going to prevent the exchange hacks? Most of the exchanges which were targeted by the hackers were KYC compliant. Cryptopia is a perfect example. On the other hand, BTC-e / Wex.nz which went without any mandatory KYC requirement survived for more than 7 years, before closing down due to unknown reasons.

[Xeaonapi]

the part of what are you saying is true i give you my vote 

Let's expose this bullshit! - "In the first quarter of 2019, theft of digital currencies from exchanges and scams totaled $356 million, while losses from fraud or misappropriated funds amounted to $851 million, the respected U.S.-based CipherTrace said in a quarterly report.

So what Reuters have done, is to add the supposed Bitfinex amount as misappropriated funds, which has not been proven and created a clickbait article with massive amounts of fraud and theft to put Bitcoin in a bad light. <The amount used in the Bitfinex/Tether witch-hunt is $850 Million>  

This is a US government and media concocted witch-hunt to scare people away from Crypto currencies. 

[alexcopper]

I still can't wrap my mind around why people wouldn't want to have compliance with AML and KYC to better help that this doesn't happen

The first part of your post was OK. But the second part shows your complete ignorance towards the basics of cryptocurrency. How KYC is going to prevent the exchange hacks? Most of the exchanges which were targeted by the hackers were KYC compliant. Cryptopia is a perfect example. On the other hand, BTC-e / Wex.nz which went without any mandatory KYC requirement survived for more than 7 years, before closing down due to unknown reasons.

What are your thoughts on having both KYC and AML complinace for exchanges?

[darylalban]

A whooping $1.2B this is indeed massive and portrays the image of cryptos in a bad light despite all regulations, KYCs, AMLs etc I wonder how those stealings aka hacking was successfully carried out without any trace and arrest. I think its high time this problem is nip in the bud else cryptos investors, adopters, hodlers and traders will lose confidence in it. More so cryptos stakeholders should devise  a better way or method of securing cryptos permanently to avoid all these embarrassing stories of hackings and theft.

I think that is my biggest fear is that this issue is going to excede beyond the random hacks. I really do not want to see people losing hope in a technology that has been so good to the world. We are all in this together, learning together losing together and ultimately building together. If we have the proper security teams working on this then both front and back end to protect the overarching community then I think we are on the right track .

[Apes]

I doubt the news. because the hottest issue lately is the binance hack, after that there is no news or info about other frauds especially with a great number. this community should know better know than Reuters news agency if there is a sensitive issue. everyone is very careful in storing their digital assets and the exchange places double the security, even if there a frud the value not big as that. so I really doubt it.

[Nasonn]

It's scary how hackers have taken advantage of the anonymous nature of crypto to steal huge amount of crypto and walk free, since they leave no identity behind and the funds cannot be reversed back on the blockchain.

[automaticmoney]

One of the big flaw crypto currency is hacking because of hacking most of the wallets are suffering security issue even some got closed the only way to protect from hacking is hardware wallets

[bitbunnny]

I doubt the news. because the hottest issue lately is the binance hack, after that there is no news or info about other frauds especially with a great number. this community should know better know than Reuters news agency if there is a sensitive issue. everyone is very careful in storing their digital assets and the exchange places double the security, even if there a frud the value not big as that. so I really doubt it.

We have to know that not only big exchanges are vulnerable to hacking but private wallets of users too. And that you will not be reading in news.
Crypto users should be more aware of danger and more protect their coins but the community is still not enough aware of that.
Criminals were always interested for every source of money and crypto is very attractive to them so I think that all kinds of frauds and hacking attacks will rise and the damage will grow.

[killat]

For some reason Paypal is better for business, because they keep it fair. You can ask for a refund if you got scammed. With crypto, you can't.

So, it can't be better than any form of traditional payment solution to be frank (unless what you are doing is against the terms of the particular payment processor).

[Ryan Dugan]

Can you believe that losses from the theft of crypto from exchanges due to fraud hit $1.2B?

https://www.reuters.com/article/us-crypto-currency-fraud/cryptocurrency-thefts-fraud-hit-1-2-billion-in-first-quarter-report-idUSKCN1S62P3

I still can't wrap my mind around why people wouldn't want to have compliance with AML and KYC to better help that this doesn't happen

Because you a newb and don't know what you are talking about. Do you think if there are laws that are somehow going to make crime magically go away? How does asking customers for KYC stop fraud?
This article is biased and I don't even know how true this all is. But sure believe what you read online.

For some reason Paypal is better for business, because they keep it fair. You can ask for a refund if you got scammed. With crypto, you can't.

So, it can't be better than any form of traditional payment solution to be frank (unless what you are doing is against the terms of the particular payment processor).

Yes because paying 7% fee is awesome for your business right? Why would you want there to be refunded? So someone can do a chargeback on you?

[fortunecrypto]

Can you believe that losses from the theft of crypto from exchanges due to fraud hit $1.2B?

https://www.reuters.com/article/us-crypto-currency-fraud/cryptocurrency-thefts-fraud-hit-1-2-billion-in-first-quarter-report-idUSKCN1S62P3

I still can't wrap my mind around why people wouldn't want to have compliance with AML and KYC to better help that this doesn't happen

Yeah I find this very alarming, and this is what those against Cryptocurrency adoption are pointing out and why some countries and companies do not want them, something drastic should be done against like a world body to regulate and strict compliance to KYC and AML but on second they are already very strict on this.

[rmilly]

I doubt the news. because the hottest issue lately is the binance hack, after that there is no news or info about other frauds especially with a great number. this community should know better know than Reuters news agency if there is a sensitive issue. everyone is very careful in storing their digital assets and the exchange places double the security, even if there a frud the value not big as that. so I really doubt it.

We have to know that not only big exchanges are vulnerable to hacking but private wallets of users too. And that you will not be reading in news.
Crypto users should be more aware of danger and more protect their coins but the community is still not enough aware of that.
Criminals were always interested for every source of money and crypto is very attractive to them so I think that all kinds of frauds and hacking attacks will rise and the damage will grow.

This is very real though. Any sort of vulnerability and these guys will swoop. We definitely need not only better education to users but also having these cyber security firms in place to watch for any illegal actions it can be solved sooner than later.

[Upgate]

Day by day, people seems to defraud their fellow human beings. That's the world we live in. it's quite unfortunate we are experiencing it in cryptocurrency. That's why it's always advice to invest with spare  money cos nobody seems to be safe in digital world. don't be carried away enticing exchange online

[Vishnu.Reang]

I still can't wrap my mind around why people wouldn't want to have compliance with AML and KYC to better help that this doesn't happen

The first part of your post was OK. But the second part shows your complete ignorance towards the basics of cryptocurrency. How KYC is going to prevent the exchange hacks? Most of the exchanges which were targeted by the hackers were KYC compliant. Cryptopia is a perfect example. On the other hand, BTC-e / Wex.nz which went without any mandatory KYC requirement survived for more than 7 years, before closing down due to unknown reasons.

What are your thoughts on having both KYC and AML complinace for exchanges?

I don't have any issued in undergoing the KYC formalities, as long as the exchange owners do proper audits on a continuous basis. KYC should not be used as a tool to harass the users, because I have seen it being used to deny withdrawal permissions. In case KYC is mandatory, then it should be compulsory at the time of registration. They should not suddenly ask for KYC, when someone is withdrawing his coins.

[Cling18]

That's a lot of money. One of the reasons why some people are afraid to take the risk of investing in crypto is because of the huge number of fraud and scams scattered around the blockchain world. It's something that we have to get rid of. This number is alarming and we can't do something about it by being careful and smart in handling our funds.

[joshy23]

That's a lot of money. One of the reasons why some people are afraid to take the risk of investing in crypto is because of the huge number of fraud and scams scattered around the blockchain world. It's something that we have to get rid of. This number is alarming and we can't do something about it by being careful and smart in handling our funds.

The only way to prevent this is to always be careful dealing with anything inside this market, you can't escape the fact that scammers and hackers are coexisting inside this industry so better to be always prepared and aware with what possible precautions to take.

[uray]

let's give this some context. chargebacks and chargeback fraud alone costs e-commerce merchants $40 billion per year now.[/url]
so a rate of $5 billion/year doesn't seem that crazy for crypto theft and fraud. bitcoins cost more than $5k a pop---we're in the big leagues now.

In that contest it true that it is not a big thing, but lets see what blockchain is all about, every transaction is recorded and it is not like the rest of the financial transactions, every transactions can be traced and we could eliminate every fraud in the market and bitcoin could be a market that bad actors would not dare to try and we will reach those position in the future and i hope every fraud being done with blockchain will be traced back in the future and they will get punished for their actions.

[JohnsonX]

I guess most of the thefts involve exchanges, wouldn't keep money in them except for funds that will be immediately traded.

[shoreno]

I guess most of the thefts involve exchanges, wouldn't keep money in them except for funds that will be immediately traded.

ive witnessed alot of scams and when i check the scammers wallet i dont see any activity for a long period of time  . i think they intended to do it and this is part of their strategy so that the public will leave them overtime  . once the scammers gets a rest , thats the time that  they will move the funds on another dummy wallet or they will use some kind of a mixing service so that they wont leave any trace  .

1billion worth of cryptos for q1 is indeed pretty huge a but i am sure that this amount will got even more bigger after we progress  .

[denzkilim]

I think it's way more than that to be honest, as there had been some thefts that are not publicized or are not being made public e.g. personal wallets, unknown exchanges/services etc. One cannot easily contain thefts as long as there are insecure platforms and personal vaults, so I don't think it's that surprising to know that such things exist in the cryptosphere, though somewhat more prevalent and frequent compared to banks, I should say (or perhaps 'more publicized' is more fitting?) Anyway, expect that number to rise as long as there are exploits to capitalize on. Sure enough, there'd be loads of thefts to follow as bitcoin and crypto is also considered money and it's gaining traction again after a few years.

That's correct, the number might be higher than the numbers reported. This hacking, stealing and any kinds of theft is a big problem in the Crypto Currency space and anyone can be a target even the top to crypto exchanges are a victim of these hacking that's why everyone should be more vigilant at times like this and anyone of us is a potential target of hackers.

[krb91]

It is truly appalling that the loss in just Q1 has reached over 1.7 billion USD. However, I still believe KYC and regulations take away the core concepts away from the 'decentralized' and 'anonymous' world of blockchain technology and cryptocurrencies. I think just like block chain technology and crypt I currencies have created a more effective means of transacting and transferring funds, a more effective model should be developed to checkmate fraud on the block chain.

[wattcrypto]

I wonder how Libra is going to have an effect on crypto thefts and fraud... really over all regulation

[mazdafunsun]

This article is interesting, there several interesting points.

The first one is that the fraud has dramatically increased compared to 2018. This is something that i was not expecting, I believed that the fraud level would be lower than in 2018 because of ICO s are not so popular anymore.

I dont understand how the OP thinks that KYC should help , this is about people scamming thru ICOs and lost funds thru exchange hacks.

I found very interesting that they keep statistics on how much funds are going out of the country.

An analysis of 164 million bitcoin transactions showed that cross-border payments to offshore exchanges have grown 46% over the last two years, contributing to the $8.7 trillion, or 11.5 percent of the world’s wealth, hidden offshore, the report said.

[jjbanks994]

This article is interesting, there several interesting points.

The first one is that the fraud has dramatically increased compared to 2018. This is something that i was not expecting, I believed that the fraud level would be lower than in 2018 because of ICO s are not so popular anymore.

I dont understand how the OP thinks that KYC should help , this is about people scamming thru ICOs and lost funds thru exchange hacks.

I found very interesting that they keep statistics on how much funds are going out of the country.

An analysis of 164 million bitcoin transactions showed that cross-border payments to offshore exchanges have grown 46% over the last two years, contributing to the $8.7 trillion, or 11.5 percent of the world’s wealth, hidden offshore, the report said.

I thought that was interesting too. It's interesting to see that there are more countries than others that have shown the highest movement of laundered money. Is there a reason for that?

[CryptoCraze11]

Don't think that normal businesses have no fraud, they also steal hundreds of millions, banks do it, businesses of all types do it, investment businesses do it. Just because the headlines are like that for crypto it doesn't mean it only happens here. There is MASSIVE fraud out there not involving crypto, billions and billions of dollars, if we knew the real figure it would make the 1.2b seem like dust.

You are right, frauds are in every business be it a fiat currency or cryptocurrency. 1.2Billion in one quarter means around 5 billion per annum and this is not a big figure if compared with market volume of cryptocurrency.