Crypto Crime Supercycle: Political Hype Fuels Scams
Crypto Crime Supercycle: Political Hype Fuels Scams
Crypto investigator ZachXBT has issued a stark warning about a "crime supercycle" in the cryptocurrency space, characterized by a significant increase in hacks, scams, and thefts. This surge, according to ZachXBT, is fueled by a combination of political hype, lax regulation, and the unchecked actions of influencers.
Meme Coins and Political Endorsements
A key catalyst for this surge is the rise of meme coins, particularly those endorsed by political figures. The lack of oversight and the perceived legitimacy lent by these endorsements have created a breeding ground for pump-and-dump schemes and outright scams. This has normalized risky behavior and emboldened bad actors.
ZachXBT highlights the lack of consequences for those involved, stating that "Since politicians launched meme coins and several court cases were dropped, criminal behavior has increased dramatically. There’s never really been repercussions, so people feel free to exploit."
Court Case Dismissals and Weak Enforcement
The dismissal of numerous legal cases involving crypto-related fraud further exacerbates the problem. The lack of understanding of smart contracts and decentralized systems within the legal system allows criminals to operate with impunity. ZachXBT notes the missed opportunity for regulatory bodies to fine influencers and projects for undisclosed paid endorsements, stating that "Government agencies could’ve easily made $50–$100 million by fining influencers and projects who never disclosed paid ads, but instead, they went after open-source developers and legit protocols."
Escalating Scams and Money Laundering
Scams are becoming more sophisticated and harder to trace, even with the transparency of blockchain technology. Money laundering groups, such as North Korea's Lazarus Group, are actively exploiting this, with alleged involvement in hacks targeting exchanges like Bybit, DMM Bitcoin, and WazirX. ZachXBT estimates the "Black U" market on the Tron blockchain to be worth $5 billion to $10 billion, much of which remains hidden from law enforcement.
The Scale of the Problem
- Over $2.1 billion lost to hacks and scams in 2025 (CertiK).
- 20 major hacks in May 2025 alone, resulting in $244.1 million in stolen assets (PeckShield).
- $96 million lost to phishing scams and over $300 million to rug pulls in Q1 2025 (Hacken).
The increasing involvement of individuals and teams with visible public profiles further complicates the issue. Influencers, YouTubers, and even developers with past ties to legitimate projects are participating in these schemes.
Codeum's Solution: Securing the Future of Blockchain
At Codeum, we are committed to enhancing the security and integrity of the blockchain ecosystem. Our services, including smart contract audits, KYC verification, custom smart contract and DApp development, tokenomics and security consultation, and partnerships with launchpads and crypto agencies, help protect projects and users from these escalating threats. We believe in building a more secure and transparent future for blockchain technology.