Rising global sanctions and increased state involvement drove illicit cryptocurrency activity to record levels in 2025. Data indicates that sanctioned entities were the primary source of these flows, although illegal use represented only a small portion of total crypto transactions. Analysts describe the shift as a response to growing geopolitical pressure rather than a failure of compliance.
In brief
- Sanctioned entities conducted $154 billion in on-chain flows in 2025, marking a 162% annual increase as global financial restrictions continued to widen.
- Nation states have seen unprecedented on-chain activity, signaling a shift in how governments are responding to sanctions and limited banking access.
- Stablecoins accounted for 84% of illegal transaction volume, reflecting the demand for price stability and efficient cross-border transfers.
- Illegal activity has remained below 1% of total usage, while the majority of criminal financing still relies on traditional fiat-based systems.
Sanctioned entities generate a record $154 billion in on-chain transactions in 2025
According to a Chainalysis report published Thursday, illicit cryptocurrency addresses received at least $154 billion in 2025. This total represents a 162% increase from $59 billion in 2024 and marks the highest level recorded to date. Most of this increase came from sanctioned actors seeking loopholes from traditional financial channels as restrictions expanded around the world.
Throughout 2025, there have been “unprecedented volumes associated with on-chain behavior of nation states.”
Chain Analysis
State-related activity was particularly marked. Chainalysis reported “unprecedented volumes” linked to government actors, describing this period as a turning point in the illicit on-chain ecosystem.
In February 2025, Russia — facing broad sanctions after its invasion of Ukraine — introduced a ruble-backed token known as A7A5. Blockchain records show that the token has processed more than $93.3 billion in less than a year, placing it among the most active state-affiliated crypto instruments observed thus far.
Sanctions continued to expand throughout the year. The Global Sanctions Inflation Index estimated nearly 80,000 individuals and entities sanctioned worldwide from May 2025.
Separate research from the Center for a New American Security found that the United States added 3,135 names to its list of Specially Designated Nationals and Blocked Individuals in 2024, the largest annual increase on record.
Nation-state activity and stablecoins are reshaping illicit crypto flows
Stablecoins have played a significant role in illicit crypto activity. Usage patterns in illegal transactions have closely mirrored those in legitimate markets, reflecting their price stability and ease of transfer.
Key developments shaping illicit crypto activity in 2025 included:
- Stablecoins represent 84% of the volume of illicit transactions.
- Sanctioned entities generating the majority of annual growth.
- Increased direct participation of nation states in on-chain activity.
- An increase in cross-border transfers despite restricted banking access.
- A preference for stablecoins due to lower price volatility.
Despite the sharp rise in the volume of illicit transactions, the illegal use of crypto remained limited in scope. Chainalysis estimates that more than 99% of all cryptocurrency activity was legitimate, with the illicit portion of attributed volume remaining less than 1%.
Criminal financing continues to rely primarily on traditional money. Estimates from the United Nations Office on Drugs and Crime place global criminal proceeds at around 3.6% of global GDP, well above crypto-related figures. Although illicit crypto totals are expected to rise in 2026 as new addresses are identified, analysts note that the broader ecosystem remains largely legal.
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