- Illegal cryptocurrency activity is evolving, with stablecoins accounting for 63% of criminal transactions by 2024.
- The MiCA regulations set a global precedent for structured supervision of digital assets.
2025 was a great year for the global cryptocurrency landscape, characterized by a significant surge in adoption and innovation.
However, this surge in mainstream acceptance has led to an alarming increase in illicit activity associated with the digital currency ecosystem.
Increase in illegal activities using cryptocurrency
According to a recent report by Chainalytic, the total value received by illicit cryptocurrency addresses has decreased to $40.9 billion in 2024.
However, the dynamics of on-chain criminal activity are changing. Stablecoins have surpassed Bitcoin (BTC) as the preferred choice for illicit transactions, accounting for 63% of all illicit transactions.
This trend reflects widespread growth in stablecoin adoption, with overall activity increasing 77% year-over-year.
Despite the decline in value received by criminal addresses, the volume of illicit cryptocurrencies could rise to $51.3 billion this year, according to predictions from Chainalytic.
This rise follows a recovery year for the cryptocurrency sector in 2023. The year saw a significant decline in fraud and hacking revenues, down 29.2% and 54.3% respectively, after a turbulent 2022.
Action taken by the European Parliament
In response to these challenges, the European Parliament has enacted strong measures to curb money laundering and illicit activity in the digital asset sector. This sets a precedent for global regulatory efforts.
The recently introduced Markets for Cryptocurrency Assets (MiCA) Regulations represent an important step in the European Union’s efforts to oversee digital assets and their markets.
The regulation, which received overwhelming support in the European Parliament with 479 votes, primarily targets cryptocurrency asset service providers (CASPs), including centralized exchanges.
MiCA scales back certain controversial proposals, such as limiting self-managed payment limits and imposing anti-money laundering (AML) requirements on decentralized autonomous organizations (DAOs) and DeFi platforms.
By working closely with existing regulatory frameworks, MiCA sets a precedent for structured oversight while providing a potential blueprint for other countries seeking to effectively regulate the cryptocurrency sector.
Added to battle…
That said, the United Arab Emirates (UAE) has also emerged as a global leader in the cryptocurrency space by implementing a well-defined regulatory framework.
The United States has achieved a level of leadership that stands in stark contrast to the regulatory challenges faced by other countries like the United States.
Moreover, the UAE’s strategic emphasis on stablecoins highlights its efforts to foster financial stability in the often unpredictable cryptocurrency market.
Trump and the future of cryptocurrency
As the countdown to President Donald Trump’s second inauguration continues, cryptocurrency markets are bracing for potential volatility. It is not yet known whether Trump will introduce reforms or regulations to curb illegal activities using cryptocurrencies.
Nonetheless, there is a lot of speculation about Bitcoin’s ability to sustain the $88,000 level. This could dictate the trajectory of the market, paving the way for a rebound or triggering a sharp sell-off.
Meanwhile, the hype around high-yield investments in tokens like PEPETO, DOGE, and Ripple (XRP) is gaining investor attention.
However, despite this optimism, the lack of a strong regulatory framework raises concerns, especially as stablecoins are frequent targets of illicit activity.
This highlights the urgent need for balanced regulation to ensure market stability amidst innovation.