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Crypto Rug Pulls Are on the Rise in 2022

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Hackers made off with $14 billion in cryptocurrency so far in 2022, according to a recent report from Chainalysis.

The rising scamming revenue largely came from rug pulls. These types of scams have become incredibly popular in crypto, especially in NFT projects.

This type of scam often occurs when a developer attracts investors to a new cryptocurrency project, which is then abandoned, leaving the investor with a worthless digital asset.

FULL VIDEO TRANSCRIPT BELOW:

Any time you have a decentralized asset class, you know with no acting government body, there’s always going to be potential theft and scams.

It’s your boy Ross Mac and this is what cryptocurrency investors are watching on Thursday, May 12.

$14 billion. That's the amount that was received by illicit addresses last year according to data from Chainalysis, marking a new all-time high. This comes as transaction volume ballooned to $15.8 trillion, which is up over 500% from 2020.

But one thing stands out in the Chainalysis report, and that's the fact that DeFi has become a much bigger story when it comes to crypto crime. The rising scamming revenue largely came from rug pulls. These types of scams have become incredibly popular in crypto--especially in NFT projects. With DeFi transaction volume up over 900%, it makes sense that crypto investors are looking to jump in on DeFi projects that could turn a hefty profit.

Chainalysis noted that DeFi allows users to trade one crypto for another, and that muddies the ability to track the funds. So, in order to make DeFi and the overall crypto space safer, is it time for regulation?

It’s your boy Ross Mac and that was the Crypto Minute on TheStreet.

TheStreet's Crypto Minute is brought to you by Blockchain.com.

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