The recently released annual report on crypto crime reveals a concerning trend. Last year, illegal crypto addresses received at least $154 billion, a 162% surge year-over-year. Even more worrying is the 694% increase in sanctioned entity activities, indicating changes in the sources and uses of illicit funds.

Stablecoins have become the primary tool for illegal transactions, accounting for 84% of total illicit activity, although illegal transactions still represent less than 1% of the entire crypto market. This figure may seem small, but its growth rate is significant.

In terms of hacking activities, North Korea-linked hackers stole $2 billion in 2025. A vulnerability attack on a certain exchange in February caused nearly $1.5 billion in losses, setting a new record for the largest single theft in crypto history.

Geopolitical factors are also driving the expansion of on-chain money laundering. Russia launched the ruble-backed token A7A5 in February, and within less than a year, its trading volume exceeded $93.3 billion. Iran's proxy networks facilitated over $2 billion in money laundering, illegal oil sales, and arms procurement through on-chain channels.

Notably, China's money laundering networks have become the dominant players in the illegal on-chain ecosystem, involved in fraud, fund transfers, and sanctions evasion, highlighting the complexity and cross-border nature of this issue.