Eastern Europe is Utilizing Cryptocurrency for “Illicit Entities”

In its recent report, Chainalysis finds out that people of Eastern Europe are actively using cryptocurrency for illicit activities. Moreover, the region is also known for its high ransomware activity.

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Blockchain and Cryptocurrency analytics firm Chainalyisis in its blog post “Eastern Europe: High Grassroots Adoption, Outsized Darknet Market and Ransomware Activity” claims that 1.4% of $41 billion transactional volume goes towards “illicit entities.” But Eastern Europe is the second one as Latin America is the top region where 1.6% of its crypto volume sent to illicit entities.

Analytics firm says that the most illicit activities occur on the Hydra Marketplace. “As we mentioned previously, most of Eastern Europe’s darknet market transaction activity occurs on Hydra Marketplace, which is the sixth-largest service by volume in the region — no other region has a darknet market or other illicit service in its top ten services,” the report reads.

High Ransomware Activity

The report unveils that Eastern Europe is also a leading region in ransomware. For example, 23% of ransomware funds received in this region. “Our data also shows that Eastern Europe leads the world in ransomware. The region accounts for more than 23% of funds received from ransomware addresses, indicating that Eastern Europe is home to the highest-earning ransomware network administrators and ransomware-as-a-service (RaaS) operators,” the report added.

There are some reasons why ransomware activity is so high in the region and report says that “higher prevalence of computer science education, combined with lower economic opportunity and, in some cases, government sponsorship of hacking activities, may explain why Eastern Europe accounts for such a high share of ransomware activity.”

Russia and Ukraine are two prominent countries in Eastern Europe, which are leading the world in cryptocurrency adoption. But the trading volume in these two countries is not very high as most of the trading occurs peer-to-peer. For instance, the P2P cryptocurrency exchange said that its user base has increased by 350% in the Coronavirus pandemic in Russia.

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