The Monetary Motion Process Power (FATF) stated in a report launched this week that world efforts to manage digital property and repair suppliers have improved however stay incomplete, with illicit use of stablecoins accelerating sharply in 2025.
The intergovernmental watchdog’s sixth focused replace on the implementation of its requirements discovered that though 73% of jurisdictions surveyed have handed legal guidelines implementing the so-called Journey Rule for crypto transfers, enforcement stays restricted.
The report famous that out of the 85 nations with Journey Rule legal guidelines, practically 60% have but to challenge compliance findings or directives.
The report additionally highlighted a record-breaking $1.46 billion digital asset theft this yr by North Korean actors from the crypto alternate Bybit.
FATF famous the hackers used social engineering and sophisticated laundering networks involving mixers, OTC merchants, and greater than 125,000 Ethereum wallets. Solely 3.8% of stolen funds had been recovered, highlighting persistent difficulties in tracing and repatriating crypto-linked proceeds of crime.
Total, stablecoins have grow to be the dominant automobile for illicit on-chain exercise, pushed by their low value, quick settlement, and broad liquidity.
FATF cited personal sector estimates exhibiting over $30 trillion in stablecoin quantity throughout the previous yr, alongside the expansion of ‘pig butchering’ scams {and professional} rip-off networks using AI-generated chatbots and deepfakes to defraud victims.
Regardless of these dangers, the report discovered that just one jurisdiction is absolutely compliant with FATF Advice 15 on digital asset oversight. In the meantime, 29% of nations had been rated ‘largely compliant,’ whereas about half stay solely partially compliant and 21% will not be compliant in any respect.
FATF urged jurisdictions to speed up licensing and registration of digital asset service suppliers, strengthen enforcement in opposition to unregistered entities, and implement measures to watch decentralized finance (DeFi) preparations.
The report additionally famous that round half of the surveyed regulators require DeFi initiatives with identifiable management events to register as VASPs, however enforcement stays uncommon.
Wanting forward, FATF plans focused reviews on stablecoins, offshore VASPs, and DeFi over the subsequent yr. The regulatory physique warned that as stablecoins method mass adoption, uneven world regulation will heighten illicit finance dangers and hamper coordinated responses.
The subsequent complete replace on Advice 15 implementation is due in 2026.
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