FATF says stablecoins drove 84% of illicit crypto volume in 2025
The watchdog’s latest update said 86% of jurisdictions have completed crypto risk assessments and 34% are now broadly compliant with Recommendation 15, while warning that enforcement and DeFi oversight remain weak.
Stablecoins accounted for 84% of illicit cryptocurrency volume in 2025, with the Financial Action Task Force warning that criminal networks are developing proprietary “seizure-proof” tokens to move funds through crypto payment rails. In its seventh targeted update on standards for virtual assets and virtual asset service providers, FATF said regulation continued to advance through 2026, with 86% of jurisdictions completing risk assessments, 83% legislating the Travel Rule, and the share rated broadly compliant with Recommendation 15 rising to 34%. The watchdog nonetheless highlighted persistent weaknesses in enforcement, VASP identification, and oversight of offshore VASPs and DeFi, and warned of risks tied to stablecoin misuse, non-custodial wallet peer-to-peer transfers, DeFi, and AI-enabled fraud.
- virtual asset service providers: Companies or platforms that provide services involving digital assets, such as exchanges or transfers.
- Travel Rule: An anti-money laundering requirement to share identifying information about parties in certain transfers.
- DeFi: Short for decentralized finance, a set of crypto-based financial services that operate through software rather than traditional intermediaries.