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New data from blockchain analytics firm Chainalysis shows that illicit cryptocurrency laundering reached at least $82 billion in 2023, up sharply from about $10 billion in 2020 and driven by a dramatic shift in how and where criminals move illicit funds.
According to a Chainalysis spokesperson, this substantial topline growth reflects the growing accessibility and liquidity of cryptocurrencies, as well as a fundamental shift in how this laundering activity occurs and by whom.
The firm’s analysis is part of its 2026 crypto crime report, which highlights that Chinese-language money laundering networks (CMLNs) are now a dominant force in the global on-chain money laundering landscape.
These networks, often operating out of messaging platforms like Telegram and through informal channels such as over-the-counter desks, gambling platforms, and money mule services, processed roughly $16 billion in 2025, roughly $44 million per day.
One of the most striking trends identified by Chainalysis is the decline in the use of centralised cryptocurrency exchanges (CEXs) for money laundering.
Traditionally, exchanges served as a key exit ramp for illicit crypto by converting it into fiat currencies or other tradable assets. But heightened compliance measures (KYC) rules and the ability of exchanges to freeze funds have made them less attractive for criminal actors.
“Compared to other laundering endpoints since 2020, inflows to identified Chinese-language networks grew 7,325 times faster than those to centralised exchanges.”
Chainalysis wrote, showing the stark divergence in laundering venues over recent years.
Analysts say the shift away from traditional exchanges toward more opaque channels is a form of adaptive criminal behaviour. Laundering operators are increasingly exploiting platforms and services where regulatory oversight is limited or inconsistent.
Tom Keatinge, director of the Centre for Finance & Security at the Royal United Services Institute, told Chainalysis that the trend is compounding enforcement challenges.
Chainalysis’s report identified six major types of services within the Chinese-language money laundering ecosystem that facilitate the movement and obfuscation of illicit funds.
These services range from guarantee platforms, which act as escrow intermediaries, to informal OTC desks and structured trade channels.
According to the data, CMLNs now handle about 20% of all known crypto money laundering activity, a proportion that has risen sharply in the past five years as centralised exchange laundering declined.
The networks also increasingly serve as exit points for proceeds of fraud, such as pig butchering scams, laundering more than 10% of stolen funds from those schemes.
Experts say this diversification and professionalisation of illicit channels reflect criminal ecosystem growth, with actors building resilient infrastructure that can absorb law enforcement pressure and regulatory tightening.
The shift in laundering patterns poses an urgent challenge for regulators and law enforcement agencies worldwide.
Although blockchain transactions are transparent by nature, it is still challenging to dismantle coordinated networks and connect on-chain activity to real-world identities, particularly when operators use informal or decentralised platforms.
Chainalysis urges authorities to target not just the wallets moving illicit funds but also the operational infrastructure and advertising channels that sustain these underground networks.
Keatinge said in an interview that a systemic global effort to upskill the crypto capabilities of law enforcement around the world and create better information-sharing mechanisms is urgently needed.
For policymakers, the findings show the need for international cooperation on regulatory frameworks and enforcement strategies, particularly in areas where informal networks operate across borders and leverage linguistic or cultural channels to evade detection.
As illicit crypto activity continues to evolve, so too must the tools, resources, and legal frameworks designed to counter it.
