FBI Reports $5.6 Billion Lost in 2023 Due to Crypto Fraud

• Cryptocurrency fraud in 2023 hit $5.6B, with the U.S. leading in complaints and losses.
• Elderly individuals suffered the most, losing $1.6B to crypto scams in 2023.
• Investment scams dominated, accounting for $3.9B in losses, with California hit hardest.

In 2023, cryptocurrency fraud reached unprecedented levels, with the Federal Bureau of Investigation (FBI) revealing that losses from these crimes exceeded $5.6 billion. This alarming figure underscores the increasing vulnerability of the crypto market to cybercriminals, particularly in the United States, which reported the highest number of complaints related to crypto fraud.

The FBI’s Internet Crime Complaint Center (IC3) reported a significant surge in complaints related to cryptocurrency fraud, totaling 69,000 cases in 2023. These scams accounted for 71% of the financial losses reported, reflecting the growing attractiveness of cryptocurrencies like Bitcoin, Ethereum, and Tether to fraudsters. 

Notably, a substantial portion of these losses was linked to investment scams, which saw a 45% increase in reported losses compared to the previous year.

The FBI’s report highlighted that elderly individuals were disproportionately affected by cryptocurrency fraud. In 2023, 16,806 victims aged 60 and above collectively lost over $1.6 billion to various scams, making them the most targeted demographic.

In contrast, younger individuals, particularly those under 20, reported far fewer cases, with 858 reports resulting in $14.7 million in losses.

The report also outlined numerous methods in which the fraudsters used in conning their victims including the tech support scam, identity theft, extortion, and cyber-romance fraud. Ponzi schemes were also identified as the most costly type of fraud as absconders cleared $3. 9 billion.

Further, the loss due to personal data breaches stood at about $ 500 Million. These crimes were most prevalent in the states of California, Florida, Texas, New York and Washington with more than $1bn being reported in California. 1 billion in losses.

Cryptocurrency scams came second as the most reported fraud in the United States, with 57,762 cases reported in 2023. Moreover, Canada, reported a smaller number, 1,236, of complaints.

Another type of fraud that increased over the years according to the FBI was the nature of cryptocurrencies which have no mediators, central authorities, or rules.