Cryptocurrency crime reached an alarming high in 2025, with an estimated $154 billion flowing to illicit addresses, marking a 160% increase from previous years. This surge, reported by Eric Jardine, head of research at Chainalysis, highlights a significant shift in the nature of crypto crime, particularly regarding the involvement of nation-states in sanctions evasion.
The landscape of illicit cryptocurrency activity has evolved beyond individual criminals. In 2025, countries like Russia began to engage in the crypto ecosystem at an unprecedented scale, primarily for the purpose of evading sanctions. This change represents a crucial departure from earlier patterns of state-linked activities, such as those seen with North Korea, which were largely focused on hacking. Instead, we are witnessing large-scale financial operations taking place in plain sight.
According to Jardine, the entry of nation-states into this space signifies a new baseline for risk in cryptocurrency. He stated, “Sanction evasion by a nation state at scale can hit tremendously large volumes.” The implications of this shift extend beyond mere criminal activity; they involve macroeconomic strategies that could reshape the future of financial compliance on blockchain networks.
From Marginal Activity to Systemic Use
Historically, illicit crypto activity often followed a predictable, entrepreneurial pattern driven by profit motives. Even cyber operations linked to North Korea represented a minor fraction of global crypto transactions. However, the dynamics have shifted dramatically with the involvement of sovereign actors, which can facilitate much larger transactions. Jardine noted the emergence of a ruble-backed stablecoin, the A7A5 token, as a major player in this new landscape. Following its launch, around $2 billion per week was processed using this token.
The resources available to nation-state actors far exceed those of typical illicit operators, leading to a concentration of illicit transaction volumes in a few instruments. The operational patterns of these actors, particularly those linked to Russia and North Korea, reflect a level of strategic planning and patience that is uncommon in traditional cybercrime.
The Role of Stablecoins and the Evolving Landscape
The Chainalysis report raises significant questions about the role of stablecoins, which now account for approximately 60% of illicit crypto activity. This figure has risen sharply due to the proliferation of the A7A5 token. While the optics may be troubling for banks and regulators, Jardine cautions against jumping to conclusions about causation.
“Stablecoins are typically the medium of choice for most users,” he explained. Their popularity stems from their stability, liquidity, and ease of transfer, making them attractive to both legitimate businesses and criminals alike. This trend reflects a convergence of use cases, wherein both sanctioned entities and legitimate operations are drawn to the same financial instruments.
As crypto crime continues to evolve, illicit services have become more specialized, offering comprehensive support for both financially motivated criminals and state-aligned actors. This professionalization complicates enforcement efforts, as large-scale services require liquidity and attract a diverse user base. Disrupting a key player in this ecosystem could yield significant repercussions, but the sophistication of these services also provides resilience against traditional enforcement measures.
Jardine emphasizes the importance of understanding the unique governance challenges posed by the rise of nation-state actors in the cryptocurrency sphere. Conventional enforcement tools designed for smaller players may not be effective against the systemic behavior of sovereign entities.
The transparency inherent in blockchain technology presents both challenges and opportunities for traditional financial institutions. Jardine highlights that the visibility of transactions on the blockchain offers a significant advantage for anti-money laundering (AML) compliance and fraud prevention. “The transparency of the blockchain actually provides a tremendous advantage when it comes to things like AML compliance or fraud prevention,” he stated.
Unlike traditional finance, where data is often siloed, blockchain allows for perpetual visibility into transaction histories. Once an asset becomes sanctioned, the detection of violations becomes straightforward. Jardine noted, “You can’t receive this token without it being, per se, a sanctions violation.”
The evolving landscape of cryptocurrency crime, while daunting, is also characterized by its visibility. As Jardine pointed out, the scale of illicit activity captures attention, but this very visibility is what enables better detection and compliance measures. The challenge lies not only in addressing the immediate risks posed by nation-state involvement but also in leveraging the advantages of blockchain technology to enhance financial integrity and oversight.
