The calculation of licit activity is a bit dubious, too. For example, the foreign exchange market has an overall volume of $6 trillion or so. It does not follow that the US GDP is only about 1% of total currency transactions and is therefore immaterial (or alternatively that currency in general is useless because 99% of global transactions are unproductive).

I’m also suspicious that Chainalysis doesn’t understand the UTXO model. If you have $1bn of Bitcoin in a single “account” (UTXO) and you spend $1, you just “transacted $1bn”. I don’t know if there are good stats on what fraction of “total volume” consists of cryptocurrency holders simply making change for themselves. It’s not immediately obvious from the blockchain which transactions outputs are actually intended for parties other than the originator of the transaction.

Chainalysis is very misleading, and a lot of naive people are taking their claims at face value.

Any chain analysis software either:

- Has insider information from all of the major exchanges, or

- Is just guessing about almost everything, so their analysis is based on many layers of questionable assumptions.

What's the alternative? This shows what % is known to be illicit. No crime stats about anything capture 100% of illicit activity, yet it's still useful information. Anything else is just guesswork.

Yep.

That's also just one way to do elicit activity in bitcoin. A person can literally send his wallet to someone else as payment for a crime. The ways to use crypto for crime are endless.