There is still much concern among government regulators about cryptocurrency fraud and illegal use. According to them, cryptocurrencies are used to commit crimes and misbehavior, but digital crime has decreased significantly in the past few years, according to a new report published by Citibank.
Janet Yellen claims high cryptocurrency crime rate
There are many key figures and financial executives currently concerned about how Bitcoin and cryptocurrencies are used. Janet Yellen, for example, recently stated that as the new Treasury Secretary, she is considering putting limits on all BTC activities in the future, claiming that it is not only volatile, but also opens the door to financial misconduct.
In addition, Gary Gensler, the presidential candidate of the Securities and Exchange Commission (SEC), stated that the organization is trying to do everything it can to fight fraud and protect investors.
“The crime rate has dropped too much”
However, people may be a little too worried, according to data from Citibank. The report explains:
In total, just over two percent of activity in the cryptocurrency space was linked to illegal activity in 2019, and that total fell to just 0.3 percent in 2020. However, the scope of such activities can often be overwhelming only in news headlines.
There is no doubt that financial crimes focused on crypto have occurred in the past. Among the biggest examples are Mt. Gox and Coincheck. In both, hundreds of millions of dollars worth of crypto funds disappeared overnight. And so far, most of this money has still not been recovered.
The industry used to be much more disorganized
Of course, these situations occurred when there was less protection and the crypto world was more reminiscent of the wild west. Now things are different and illegal activity is really in the minority.
However, the document mentions that while crime rates are at a new low, adoption will not become widespread for a while, given that there are still barriers to Bitcoin and crypto-based payment systems, and these problems remain. Some of the main problems occurring in the crypto space are volatility and price fluctuations. Citibank says:
Security issues with cryptocurrency may arise, but it performs better when compared to traditional payments. The influx of institutional investors has increased confidence in cryptocurrency, but there are still persistent problems that may limit widespread adoption.