Stablecoins have become the go-to digital currency for illicit activity, overtaking Bitcoin for the first time, according to blockchain analytics firm Chainalysis. The findings, cited by River, show that criminals are increasingly using stablecoins like USDT and USDC to move, launder, and store proceeds from illegal operations. The shift marks a significant change in the crypto-crime landscape, which for years was dominated by Bitcoin.
The shift in criminal preference
Chainalysis data points to a clear trend: stablecoins now account for a larger share of illicit transaction volume than Bitcoin. Historically, Bitcoin was the default choice for darknet markets, ransomware payments, and theft proceeds because of its pseudonymity and wide acceptance. But stablecoins offer price stability and are often easier to move through centralized exchanges, making them attractive for criminals looking to avoid the volatility that once plagued Bitcoin-denominated crime.
Why the switch matters
The change has implications for law enforcement and compliance teams. Bitcoin’s public ledger makes it relatively straightforward to trace transactions, even when mixers or tumblers are used. Stablecoins, particularly those issued on permissioned blockchains or processed through large exchanges, can present different tracking challenges. Some stablecoin issuers have the ability to freeze funds, which adds a new dynamic to illicit finance — but it also means criminals may be drawn to less regulated stablecoin variants.
What the data says
The exact figures behind the trend were not disclosed in the report, but the direction is clear. River, a financial services firm, highlighted the Chainalysis data in its own analysis of crypto crime patterns. The data reinforces a broader observation: as stablecoin adoption has exploded over the past two years, so too has their use in illicit contexts. The question now is whether regulators and stablecoin issuers can keep pace with the shift.
