Stablecoins have overtaken Bitcoin as the primary vehicle for cryptocurrency crime, accounting for 84% of all illicit transaction volume in 2025, a shift that coincides with mounting regulatory pressure on digital assets and their expanding role in everyday payments worldwide.
What Happened: Stablecoins Dominate Crime
Chainalysis released its 2026 Crypto Crime Report on Jan. 8, revealing that dollar-pegged tokens now handle the vast majority of illegal cryptocurrency activity.
The data marks a dramatic reversal from 2020, when Bitcoin represented roughly 70% of illicit transactions while stablecoins accounted for just 15%. Today Bitcoin's share fell to approximately 7%.
Criminal organizations have gravitated toward stablecoins for practical reasons.
The tokens offer price stability that volatile assets cannot match, making them predictable for large-scale operations where a million dollars today needs to remain a million dollars tomorrow.
"Stablecoins have come to dominate the landscape of illicit transactions," the report stated. "This mirrors broader ecosystem trends where stablecoins occupy a sizable and growing percentage of all crypto activity due to their practical benefits: easy cross-border transferability, lower volatility, and broader utility."
Networks operating on low-cost blockchains like TRON have enabled sanctioned groups to move funds across borders without traditional banking infrastructure.
Popular stablecoins including USDT and USDC have emerged as preferred tools.
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Why It Matters: Regulatory Pressure Intensifies
The shift carries significant implications for everyday users who rely on stablecoins for trading and remittances. Exchanges and wallet providers now face heightened scrutiny, leading to increased identity verification requirements and more frequent transaction reviews.
Chainalysis noted that despite the surge in criminal activity, illicit transactions still represent less than 1% of total cryptocurrency volume.
"As nation-states plug into the illicit crypto supply chains originally built for cybercriminals and organized crime groups, government agencies and compliance and security teams now face significantly higher stakes on both the consumer protection and national security fronts," the firm wrote.
The trend extends beyond organized crime to state actors.
Russia's ruble-backed A7A5 token processed over $93.3 billion in its first year, while Iranian proxy networks facilitated more than $2 billion in illicit activity.
These developments have intensified government debates over stablecoin regulation globally, potentially bringing more oversight to payment systems even as it reduces privacy for users seeking speed and convenience.
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