While many believe the crypto bear market season is the time to build, scammers have always viewed it as otherwise. And according to blockchain analysis firm Chainalysis’s latest reveal, they seem to adapt too often to the state of the market, whether bear or bull season.
In a webinar focused on crypto crimes affecting consumers and investors, Eric Jardine, the cybercrimes research lead at Chainalysis, revealed some insights addressing the adaptation of scammers as market conditions change.
Chainalysis Reveals Scammers Blend With Every Market Situation
According to Jardine in the webinar, some scammers gave up amid the bear market; others adapted as some schemes used in this illegal activity differed from the usual style. Jardine said:
One of the new innovations in this year’s report was sub-classing scams into types. And there, what we discovered was that not all scams behaved the same way in the context of the bear market.
Per Jardine’s explanation in the Webiner, crypto investors were still frightened and extremely cautious due to the aftermath of the Terra Collapse, which made them lose millions. As such, scammers shifted strategies to adapt and preyed on investors’ fear.
Jardine explained bad actors turned to other ways of scamming, including giveaways and “romance scams.” The cybercrime expert added:
It’s suggestive here that there is an adaptation on the part of the scammers and market conditions make investment scams unlikely to be profitable; they may be substituting their tactics toward other scams that play on different emotional sense.
Jardine further noted scammers are not simply “playing the same script over and over” as one scheme stop being effective but can also change based on the market condition.
The Target Is Mostly DeFi
Meanwhile, scammers appeared to be more interested in exploiting the developing decentralized finance (DeFi) market than any other ecosystem in the crypto sector. According to data from DeFi Llama, more than $200 million has been stolen from several DeFi platforms in the market in 2023 alone.
March still has the highest total value hacked so far, with over $200 million siphoned from DeFi platforms; February had the least high with $30.6 million, and January with lowest of just $8.6 million.
Furthermore, with bad actors’ using new methods of exploiting the overall crypto market, the assurance of whether scams in the sector may come to an end soon is still very much uncertain.
The global crypto market records a capitalization of just above $1 trillion. As of this writing, the global crypto market capitalization stands at $1.2 trillion, down by 0.2% in the last 24 hours.