As the Trump administration is adding rocket fuel to sanction enforcement, it’s also been legitimizing crypto.
An early preview of Chainalysis’s annual crypto crime report reveals that crypto addresses tied to criminal operations pulled in at least $154 billion during 2025, shattering prior records with a 162% jump from the previous year’s revised $57.2 billion figure. This spike stems largely from sanctioned entities, which saw inflows balloon by 694% year-over-year, signaling a shift where crypto is increasingly relevant at the geopolitical level and used to sidestep financial sanctions and restrictions in the traditional banking system.
The firm’s data traces this upward trajectory from just $11 billion in 2020, and Chainalysis stresses that these numbers represent a conservative baseline, as ongoing investigations often uncover more suspect addresses. For example, the 2024 estimate rose from an initial $40.9 billion to $57.2 billion after more illicit addresses were identified.
Specific nation-state maneuvers identified in the report include those of North Korean hackers, who netted $2 billion through thefts, including the record $1.5 billion exploit against crypto exchange Bybit in February. Russia rolled out its ruble-pegged A7A5 token for sanctions dodging that same month, racking up $93.3 billion in transactions within its debut year. Meanwhile, networks linked to Iran laundered over $2 billion for covert oil exports, arms deals, and other activities.
Beyond state-level exploits, the report points to rising professionalism in underground networks. Chinese money laundering outfits have cornered the market on “laundering-as-a-service,” aiding everything from fraud to terrorist financing. The numbers associated with these schemes can reach eye-popping levels. For example, one pig butchering scheme, where victims are tricked into investment scams via romantic conversations over the phone, is at the center of a dispute between the U.S. and China over $13 billion worth of bitcoin.
Stablecoins emerged as the go-to vehicle for crypto crime in 2025, comprising 84% of illicit flows thanks to the short-term price stability associated with these dollar-pegged tokens. Despite built-in compliance features like the ability to freeze funds, bad actors appear to be undeterred. This trend aligns with U.S. policy shifts under the Trump administration, where officials touted stablecoins for extending American economic influence. The GENIUS Act, which was signed into law last year, formalized oversight for these assets, sparking a massive boom in adoption and development by banks and tech firms.
Yet questions linger on stablecoins’ true innovation edge, as much of the appeal seems rooted in skirting rigorous anti-money laundering checks. The sector’s pivot toward these centralized tokens has intensified, with issuers like Circle and Tether steering traffic to more centralized or even proprietary blockchains over more decentralized options like Ethereum.
In contrast, altcoins, which most notably include privacy coins like Monero and Zcash, saw their illicit share dwindle. Relatedly, a recent CoinDesk piece noted online criminals ditching Monero for Bitcoin amid exchange delistings and tighter controls. Still, privacy themes gained traction overall in 2025, underscored by Zcash’s price gains, some of which were reversed by a recent controversy at Electric Coin Company that saw its core devs leave the company amid accusations of losing its mission.
With all this said, Chainalysis indicates that identifiable illicit dealings were still under 1% of total crypto transactions in 2025. And Bitcoin’s transparent design, with its pseudonymous ledger and heavy exchange oversight, aids tracking by companies like Chainalysis and their cooperative investigations with law enforcement officials.
While decentralized networks with cypherpunk roots like Bitcoin and Monero can resist shutdowns, stablecoins operate in a centralized, issuer-backed model that invites regulatory crackdowns if criminal activity gets out of hand. Lawmakers or regulators may eventually decide that the increased monetary dominance enabled by frictionless stablecoins is not worth the tradeoffs related to the criminal activity associated with these tokens.
