In recent findings by blockchain analytics company Chainalysis, a concerning rise in the use of stablecoins for illicit activities has been observed. According to their 2023 report, 70% of fraudulent cryptocurrency transactions's medium were stablecoins. Making matters worse, it was found that 83% of payments made to sanctioned countries, such as Iran and Russia, were facilitated through crypto.
Stablecoins, in 2023, accounted for a massive 59% of all cryptocurrency transaction volumes. These numbers strikingly overshadow the overall growth in the legal usage of stablecoins.
Chainalysis identified illegal stablecoin transactions amounting to a staggering $40 billion across 2022 and 2023. The primary category contributing to this nefarious activity was sanctions evasion. In 2023, of the $24.2 billion logged in clandestine transactions, more than half were committed for the purpose of dodging sanctions, with stablecoins being the dominant facilitator.
These findings underscore the pressing necessity for enhanced regulation and monitoring within the cryptocurrency sector, specifically stablecoins, to deter illegal activities and maintain the integrity of the digital currency ecosystem.