**Illicit Crypto Activity Hits Record $158bn in 2025**

A staggering figure has emerged from the world of cryptocurrency, highlighting the persistent threat of illicit activity in the sector. According to a report by blockchain analytics firm TRM Labs, illicit crypto wallets received an estimated $158 billion in currency last year, a record high observed in five years.

This represents a significant 145% increase on the previous year's figure of $64.5 billion, although TRM Labs caveats that changes to its methodology mean direct historical comparisons are problematic. A report from Chainalysis arrived at a similar figure for 2025: $154 billion, claiming an even higher annual increase of 162%.

So what explains the sharp rise in illicit crypto activity? According to TRM Labs, several factors contribute to this trend:

* Increased capital flows: As more investors enter the market, bad actors have found new opportunities to exploit. * Rise of decentralized finance (DeFi): The growth of DeFi platforms has created a fertile ground for illicit activities, including money laundering and terrorist financing. * Improved anonymity tools: Advances in technology have made it easier for bad actors to remain anonymous, further enabling their nefarious activities.

While the figures are alarming, there is some good news. According to TRM Labs, as a share of total blockchain flows, illicit activity is on the decline. Bad actors "absorbed a smaller proportion of new capital entering the crypto ecosystem" last year, indicating that efforts to combat illicit activity are beginning to bear fruit.

Measuring illicit activity relative to incoming liquidity, TRM Labs found that illicit entities received 2.7% of incoming VASP flows in 2025, compared with 2.9% in 2024 and 6.0% in 2023. This trend suggests that the crypto industry is becoming increasingly resilient against illicit activity.

As more intelligence about 2025 activity becomes available, TRM Labs expects its estimates to be revised upwards. The firm notes that its estimate for 2023 rose from $34.8 billion at publication to over $58 billion as new data emerged.

"As investigations progress, new sanctions are issued, cases are unsealed, and additional information becomes public, previously unknown wallets and transactions are frequently linked to illicit actors," TRM Labs explained.

"As a result, overall estimates of illicit volume tend to increase over time. Readers should therefore view the figures in this report as a dynamic baseline rather than a fixed measurement."

**Stay up-to-date on the latest developments in cryptocurrency-related crime by following our news section:** [North Korea Steals Over $2bn in Crypto in 2025](link)