An interesting investigation was made by the Chainalysis. More than one million Bitcoin is held by illicit actors in the space with over half being held by cybercriminals.
Illicit markets have 585,000 BTC in their possession, scams have 99,000 BTC, stolen funds constitute another 205,000 BTC, and all others hold an additional 3,000 BTC — a total of 892,000 BTC. According to Chainalysis, only 0.32% of all current Bitcoin flows are tainted by illicit activity.
P2P Exchanges play the main role
The top destinations for illicit Bitcoin are crypto exchanges. This coincides with the observed behavior of Twitter’s recent hackers, who were quick to move their newly acquired assets to the exchanges. Roughly 300,000 Bitcoin is held by scammers and thieves. In recent years, crypto exchanges have begun to take their Know Your Customer and Anti-Money Laundering procedures more seriously. These policies make it very hard for cybercriminals to offload their ill-gotten loot, which also bodes well for the market as massive selloffs by the criminals could lead to a collapse in price.