Illicit crypto usage has decreased as a percentage of total usage.

Hacks and frauds account for less overall activity as the crypto market grows, and their fraction of total usage continues to fall.

According to blockchain forensics firm CipherTrace, illicit cryptocurrency activity decreased as a fraction of overall crypto activity in 2021 and the first quarter of 2022.

In certain regions, the Bitcoin business has long been seen as a sanctuary for unlawful behavior. According to CipherTrace, criminal activity accounted for 0.62 percent to 0.65 percent of total bitcoin activity in 2020. In 2021, it is expected to represent between 0.10 percent and 0.15 percent of total activity, according to the business.

The top ten decentralized finance (DeFi) attacks in 2021 and Q1 2022 netted attackers $2.4 billion, according to CipherTrace’s “Cryptocurrency Crime and Anti-Money Laundering” report, issued Monday.

Over half of the amount came from only two instances, the greatest of which being the $650 million Ronin Network attack in late March 2022 and the $610 million Poly Network hack in August 2021, the majority of which was returned by the anonymous hacker.

According to Kyckr, anti-money laundering (AML) fines in the banking industry grew considerably during the same time period, with 80 institutions punished in 2021, up from only 24 in 2020.

While the total cash amount of fines decreased from 2020, banks were fined $2.7 billion for AML or Know Your Customer (KYC) infractions last year, with the greatest single charge totaling about $700 million.

While large quantities have been abused in crypto, CipherTrace described the fast-developing crypto ecosystem, stating that overall crypto market activity in 2020 was roughly $4.3 trillion, which climbed to around $16 trillion in the first half of 2021.

According to CipherTrace, the crypto market’s rise has drawn more scrutiny from authorities across the world, who are “beginning to take serious action to guarantee that the industry isn’t merely a modern-day wild west.”

President Biden’s crypto executive order to examine blockchain technology in March, Dubai’s establishment of a virtual assets regulator, and the European Union’s planned Anti-Money Laundering regulations are among the most noteworthy regulatory developments listed in the paper.

Organizations will have a “very real incentive to shape up” or risk “huge losses at the hands of the government,” according to CipherTrace, which also anticipates future regulatory initiatives to focus on the threats that exist in crypto.