TRM’s report shows crypto is now embedded in state economic and security planning, not treated as a fringe asset.
A new report by blockchain intelligence firm TRM Labs has revealed that governments around the world are no longer standing on the sidelines of crypto markets, with states from North Korea to Singapore actively putting blockchain networks to work as part of their national financial strategies.
However, there’s a divide between how authoritarian and democratic governments use digital assets, and this, per the report, is turning crypto into a quiet but powerful force in global finance and geopolitics.
According to TRM, blockchain’s borderless design allows countries to move value outside traditional systems built around the U.S. dollar, SWIFT, and correspondent banking, with authoritarian regimes leaning heavily on this feature.
North Korea stands out as the most aggressive example. The firm linked the country’s cyber units to exchange, DeFi, and bridge hacks worth billions of dollars, including the high-profile Bybit breach in February 2025.
Investigators traced how stolen funds were routed through mixers, shifted across blockchains, converted into stablecoins, and eventually cashed out through over-the-counter brokers in Asia. Those proceeds, TRM said, flow back into Pyongyang’s missile and nuclear programs.
Russia, for its part, has taken a different route since facing sweeping sanctions following its 2022 invasion of Ukraine. While digital assets have not replaced traditional finance, TRM’s data shows they now play a supporting role in cross-border settlements with partners such as Iran, fundraising for pro-Russian groups, and large-scale mining operations that turn cheap energy into foreign currency.
Meanwhile, Iran legalized Bitcoin mining in 2019 and, according to the report, has been using domestically mined BTC to pay for imports while bypassing payment restrictions.
Not all state use of crypto is adversarial. The study portrayed democratic governments as focusing on oversight, transparency, and market stability.
In the U.S. and Europe, for instance, agencies are now relying on blockchain analytics to trace ransomware payments, enforce sanctions, and support cross-border investigations. Europe’s MiCA framework, now in force, requires strict licensing and monitoring for crypto firms, while U.S. regulators are still refining digital asset rules through bodies such as FinCEN and OFAC.
Asia offers a more collaborative model, with Singapore’s Monetary Authority working closely with private firms on compliance technology, while Japan has strengthened exchange supervision following past hacks.
Additionally, many central banks in the region are testing government-issued digital currencies and tokenized reserves, borrowing ideas from public blockchains while keeping tight state control.
The contrast is stark. Where North Korea uses crypto to dodge restrictions and fund weapons, countries like Singapore and those in the EU have applied similar tools to modernize payments and supervision. TRM argued that the difference comes down to visibility and enforcement. Public blockchains record every transaction, but only strong analytics and cooperation can turn that data into accountability.
As crypto markets continue to mature, the report suggests this divide will widen. Authoritarian states are likely to keep probing digital assets for workarounds, while democratic governments will push for rules that tie innovation to oversight.
