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Dec 9, 2025
How a cryptocurrency helps criminals launder money and evade sanctions
The Indian Express
A report released in February from Chainalysis, a blockchain analysis firm, estimated that up to $25 billion in illicit transactions involved stablecoins last year.
Smugglers, money launderers and people facing sanctions once relied on diamonds, gold and artwork to store illicit fortunes. The luxury goods could help hide wealth but were cumbersome to move and hard to spend.
Now, criminals have a far more practical alternative: stablecoins, a cryptocurrency tied to the U.S. dollar that exists largely beyond traditional financial oversight.
These digital tokens can be bought with a local currency and moved across borders almost instantly. Or they can be returned to the traditional banking system -- including by converting funds into debit cards -- often without detection, a New York Times review of corporate filings, online forum messages and blockchain data shows.
A report released in February from Chainalysis, a blockchain analysis firm, estimated that up to $25 billion in illicit transactions involved stablecoins last year. And as more Russian oligarchs, Islamic State group leaders and others have begun using the cryptocurrency, the rise of these dollar-linked tokens threatens to undermine one of America's most potent foreign policy tools: cutting adversaries off from the dollar and the global banking system.
"Bad actors are moving faster than ever before," said Ari Redbord, a former Treasury official and the head of policy at TRM Labs, a blockchain data company. Sanctions and other economic penalties, he said, lose force when criminals can move millions with a few clicks.
Governments are racing to contain the activity. Late last month, Britain arrested members of a billion-dollar money-laundering network that purchased a bank in Kyrgyzstan in order to help evade sanctions and facilitate payments in support of Russian military efforts. For a fee, Britain's National Crime Agency said, the launderers would convert money, often generated from the drug trade, fir
