2025 Crypto Compliance Annual Report: Your Crypto Assets Are Flowing Towards These "Escrow Platforms" and the Abyss of Online Gambling.

Authors: Beosin x ACAMS x ABCP

Foreword

2025 is a pivotal year for establishing the global regulatory landscape for virtual assets, and also a year in which anti-money laundering compliance faces significant challenges. From the implementation of the US GENIUS Act and the full enactment of the EU MiCA, to the passage of Hong Kong's Stablecoin Ordinance and the advancement of the ASPIRe roadmap, major jurisdictions worldwide are accelerating the construction of systematic and multi-dimensional regulatory frameworks. At the same time, virtual asset crimes are exhibiting cross-border, organized, and technological characteristics, posing a severe challenge to traditional anti-money laundering systems.

This report, initiated by Beosin in collaboration with the Association of Certified Anti-Money Laundering Professionals (ACAMS) and the Association of Blockchain Compliance Professionals (ABCP), focuses on the global anti-money laundering and regulatory dynamics of virtual assets in 2025. It systematically reviews the regulatory landscape of major countries and regions, deeply analyzes the characteristics of virtual asset crimes and money laundering methods, and focuses on emerging technology trends such as the x402 payment protocol, dedicated chains for stablecoins, and prediction markets. The report aims to provide industry practitioners, regulatory agencies, and researchers with an objective and professional perspective, offering a valuable and insightful annual observation.

1. Analysis of the Global Anti-Money Laundering and Regulatory Landscape for Virtual Assets

2025 is considered a watershed year in the history of global virtual asset regulation. If the previous decade was a period of observation and trial and error for regulators around the world regarding this emerging asset class, then 2025 marks the formal establishment and systematization of the global regulatory framework. As blockchain technology becomes deeply embedded in global financial infrastructure, governments no longer examine virtual assets solely from the perspective of anti-money laundering (AML) and counter-terrorist financing (CFT), but rather view them as a core component of the future digital economy, thereby building a comprehensive governance system encompassing prudent regulation, market behavior, investor protection, and systemic risk prevention.

This year has witnessed a profound paradigm shift in regulatory focus: regulators have moved from passively responding to market innovation to proactively setting technical standards and market access rules through legislation. This is particularly evident in the enactment of the US GENIUS Act, the full implementation of the EU's Crypto Asset Market Regulation (MiCA), and the passage of Hong Kong's Stablecoin Ordinance and the advancement of the "ASPIRe" strategic roadmap. Major global financial centers have essentially completed the closed loop of top-level design. This trend from "vague exploration" to "rule formation" has not only cleared legal obstacles for the large-scale entry of traditional financial institutions (TradFi) but also posed unprecedented challenges to the compliance and survival capabilities of native crypto companies.

At a deeper level, the tightening and clarification of regulations paves the way for the "decriminalization" and "financial instrumentation" of virtual assets, which is beneficial to the long-term healthy development of the industry. As the regulatory framework improves, regulatory arbitrage opportunities are effectively reduced, further separating illicit funds from the compliant market and promoting a more standardized and transparent ecosystem. The increasingly clear boundary between the compliant market and illegal activities not only enhances the confidence of market participants but also lays the foundation for the integration of virtual assets into the mainstream financial system.

1.1 Regulatory Landscape of Virtual Assets in Major Countries and Regions in 2025

1.1.1 United States

Regulatory Landscape: In July 2025, the United States formally passed the GENIUS Act, establishing a regulatory framework for payment-based stablecoins. This marked the first time the United States legislated at the federal level to recognize and regulate stablecoins.

● It is clearly stated that stablecoins are neither securities nor commodities;

● The issuer must hold a 1:1 reserve (cash or US Treasury bonds with a maturity of 93 days);

● Establish a "Stablecoin Certification Review Committee" and restrict tech giants (such as Meta and Apple) from issuing stablecoins;

● Strengthen KYC, AML, and consumer protection;

● Foreign issuers (such as Tether) must be registered in the U.S. or they will be barred from the market.

Learning from the devastating collapse of Terra/Luna and the misappropriation of user assets by FTX, the GENIUS Act established near-stringent standards for the management of reserve assets. The Act mandates that issuers hold a 1:1 ratio of reserve assets, with eligible assets limited to cash or U.S. Treasury bills with maturities of 93 days or less. This provision excludes high-risk assets such as commercial paper and corporate bonds, ensuring the high liquidity and security of the underlying assets of stablecoins.

The more crucial institutional innovation lies in bankruptcy remoteness and priority of payment. The bill modifies the applicable logic of bankruptcy law, explicitly stipulating that in the event of an issuer's bankruptcy or insolvency, stablecoin holders have a "first priority" over other general unsecured creditors of the issuer in the event of bankruptcy. This provision fundamentally addresses the risk of user funds becoming "unsecured claims" and greatly enhances institutional investors' confidence in using stablecoins for large-scale settlements. This legal certainty is the prerequisite for traditional financial institutions to dare to incorporate stablecoins into their core business, and it also lays a legal foundation of trust for the application of emerging technologies such as the "x402 payment protocol" mentioned in later chapters.

Currently, the virtual asset industry in the United States is regulated collaboratively by multiple agencies: the Securities and Exchange Commission (SEC) is responsible for regulating virtual currencies with securities characteristics; the Commodity Futures Trading Commission (CFTC) regulates virtual currency futures contract trading; the Office of the Comptroller of the Currency (OCC) is responsible for regulating the issuance, custody, and payment of stablecoins; and the Financial Crimes Enforcement Network (FinCEN) combats money laundering and other illegal and criminal activities.

While establishing stringent standards, regulators are also loosening restrictions on traditional financial institutions. The Federal Reserve has lifted previous restrictions on banks engaging in crypto business, allowing them to decide independently whether to offer custody, payment, and issuance services for crypto assets, provided they have established a sound risk management system. In December 2025, the Federal Deposit Insurance Corporation (FDIC) further approved a proposal to implement the application process of the GENIUS Act, clarifying the specific procedures for bank subsidiaries to apply for the issuance of stablecoins. However, due to concerns about antitrust and data privacy, the Act established a "Stablecoin Certification Review Board" and imposed additional restrictions on large technology companies (such as Meta and Apple) issuing stablecoins. This differentiated treatment reflects regulators' wariness of the "commercial data + financial monopoly" model, aiming to prevent tech giants from using their vast user networks to form a closed-loop ecosystem of supranational currencies.

1.1.2 Hong Kong

Regulatory Landscape: In February 2025, the Hong Kong Securities and Futures Commission (SFC) released the highly forward-looking “ASPIRe” regulatory roadmap, which aims to comprehensively reshape Hong Kong’s virtual asset financial ecosystem through five pillars.

● Access: Simplify market access through regulatory clarity. The focus in 2025 is on filling regulatory gaps in over-the-counter (OTC) trading and custody services, establishing a licensing system to allow compliant institutions easier access to the market, while excluding illicit OTC transactions from the formal financial system.

● Safeguards: Optimizing compliance burdens. Regulators acknowledge that past "one-size-fits-all" rules (such as extremely high cold wallet storage requirements) may have hampered operational efficiency, and are therefore shifting to a "risk-based" regulatory approach, exploring ways to adjust custody technology standards and storage ratios in line with technological advancements.

● Products: Enriching product supply. SFC has clearly stated that it will expand the range of tradable assets and services based on investor categories (retail vs. professional), breaking away from the previous situation of being limited to only a few mainstream cryptocurrencies.

● Infrastructure: Modernize regulatory infrastructure. Leverage regulatory technology (RegTech) to improve reporting and monitoring efficiency, and strengthen cross-departmental intelligence sharing among the SFC, HKMA, and the Police Force to address increasingly sophisticated on-chain crime.

● Relationships: Strengthen ecosystem ties. Enhance cooperation with global regulatory bodies, promote cross-border law enforcement assistance, and rebuild market confidence through investor education.

In May 2025, the Hong Kong Legislative Council passed the Stablecoin Ordinance, which officially came into effect in August 2025. This makes Hong Kong one of the few jurisdictions in Asia to have implemented institutionalized regulation of stablecoins.

*For a detailed interpretation of the "Stablecoin Regulations," please refer to the full version.

In response to the issue exposed in the JPEX case, where unlicensed OTC entities (such as street money changers) became entry points for fraudulent funds, the Hong Kong government completed a consultation on the licensing system for OTC and custodians in June 2025 and initiated the legislative process in the second half of the year.

● OTC Regulation: Overseen by the SFC, the focus is on combating money laundering risks, requiring OTC merchants to implement strict customer registration and transaction limit management. This measure directly undermines the cash laundering methods employed by "black and gray market guarantee platforms" using offline OTC transactions, as described in Chapter Two of this report.

● Custody Regulation: The SFC will establish a dedicated custody license (Type 13 RA) to bring independent custodians under its regulatory framework. This ends the previous situation where only VATP affiliates could provide compliant custody services, enabling professional third-party custodians (such as banks and trust companies) to obtain independent licenses and provide the market with safer asset custody services.

The improved regulatory framework for virtual assets has provided solid support for law enforcement practices. In August 2024, the Organized Crime and Triad Bureau (OCTB) of the Hong Kong Police Force issued a formal letter of appreciation to a cryptocurrency exchange, recognizing the exchange's investigation team's contribution to a major kidnapping case. The letter, personally signed by OCTB Senior Superintendent Au Yeung Chiu-kong, specifically thanked one investigator from the exchange's investigation team, who had recently joined the ABCP as a member of its executive committee. In the letter, the Hong Kong Police Force thanked the investigator for helping the police successfully identify suspects from a criminal syndicate, thereby advancing the case's resolution.

The exchange provided crucial leads to assist police in tracking suspects through intelligence analysis from its Financial Crime Compliance Team (FCC). This case demonstrates that criminals may use cryptocurrency as a tool for transferring funds in various types of criminal activities, such as ransom laundering after kidnapping or cross-border money flows. However, leveraging expertise in blockchain analytics and professional investigative techniques, private analytics firms and law enforcement agencies were able to effectively track on-chain fund flows, identify anomalous patterns, and pinpoint suspects, significantly improving investigative efficiency. This letter of appreciation not only highlights the effectiveness of public-private partnerships in combating emerging technology crimes but also serves as a positive example of how blockchain analytics and intelligence firms like Beosin and ABCP, as well as compliance organizations, can drive interaction between the industry and law enforcement, proving that professional blockchain investigative capabilities can play a crucial role in diverse criminal scenarios.

1.1.3 European Union

Regulatory landscape: Although some provisions of the Crypto Asset Markets Act (MiCA) came into effect in 2024, it was not until December 30, 2024, that the Act was fully implemented in the 27 EU member states and the three European Economic Area countries, achieving uniformity in regulatory rules.

MiCA categorizes stablecoins into Electronic Money Tokens (EMTs) and Asset Reference Tokens (ARTs). EMTs maintain their value by referencing an official currency (i.e., fiat-backed stablecoins), while ARTs stabilize their value by referencing a combination of values ​​or rights. MiCA stipulates that issuers of EMTs must be authorized EU credit institutions (i.e., banks) or electronic money institutions (EMIs). This means that issuers without an EMI license in the EU cannot list their tokens on exchanges within the EU. This regulation dealt a devastating blow to Tether (USDT). Due to Tether's failure to apply for or obtain an EU license, major exchanges such as Coinbase, OKX, and Bitstamp successively announced the delisting of USDT for European users in late 2024 and early 2025.

● Stablecoin issuers are required to publish white papers that disclose detailed information about the issuer, stablecoin characteristics, associated rights and obligations, underlying technology, risk factors, and asset reserves.

● Any marketing communications related to stablecoin trading must be clear and unambiguous, avoiding inflammatory statements, and controlling the risk of speculation from the source;

● The issuer ensures 100% underlying asset reserves and reports regularly to guarantee the stability of the stablecoin's value;

● The daily trading volume of a single ART or EMT must not exceed €5 million. When the market value of an ART or EMT exceeds €500 million, the issuer must report to the regulatory authority and take additional compliance measures.

● When the usage of ART in a single currency area exceeds 1 million transactions or the transaction value reaches 200 million euros (quarterly average), the issuance of that ART must be stopped;

● Only euro stablecoins can be used for everyday payments for goods and services, limiting the use of non-euro stablecoins in the EU.

According to Decta's "2025 Euro Stablecoin Trends Report," within 12 months of MiCA's implementation, the market capitalization of major euro stablecoins increased by 102%, completely reversing the downward trend of the previous year.

● EURC (Circle): As a stablecoin issued by Circle, its trading volume increased by an astonishing 1139% after the implementation of MiCA, and it has captured more than 50% of the market share in circulation, becoming the de facto leader of stablecoins.

● EURS (Stasis): As a long-established euro stablecoin, its market capitalization has surged from $38 million to $283 million, a growth rate of over 600%.

● EURCV (Société Générale - Forge): Issued by a subsidiary of Société Générale, EURCV represents a traditional bank's attempt to enter this field. Its trading volume increased by 343%, and although the base is small, it is significant – bank-issued stablecoins are beginning to gain liquidity in the DeFi space.

Furthermore, the Digital Operations Resilience Act (DORA) officially came into effect on January 17, 2025. While DORA is not solely aimed at the crypto industry but covers all financial institutions, its impact on crypto businesses is particularly profound.

● Core Requirements: DORA mandates that financial entities establish extremely high standards of IT security to defend against cyberattacks and technical failures. It grants regulators the power to directly scrutinize critical third-party ICT service providers (such as cloud service providers and node service providers).

● Industry Impact: This means that crypto exchanges and custodians must not only manage their own systems but also be responsible for the stability of the on-chain infrastructure they rely on (such as oracles and node networks). This echoes the "prediction market oracle manipulation risk" mentioned in Chapter 4 of this report—regulators are beginning to focus on the single point of failure risk of decentralized infrastructure.

In addition, the newly established European Anti-Money Laundering Authority (AMLA) will begin operations in 2025, directly regulating high-risk CASPs, with a particular emphasis on monitoring cross-border transactions and privacy coins, which aligns with the global trend of combating crypto money laundering.

2. Global Virtual Asset Crime Situation

In 2025, the rapid expansion of the cryptocurrency ecosystem and technological innovation went hand in hand, leading to a comprehensive upgrade in criminal methods. From on-chain attacks and cross-chain money laundering to generative AI fraud scenarios and dark web quick payment scenarios, cryptocurrency crimes have become more prominent in terms of concealment, intelligence, and cross-border operations.

The rapid expansion of transnational criminal syndicates in terms of organizational scale, business chains, and modus operandi has led to an unprecedented increase in their cross-border collaboration capabilities and risk spillover effects. From early-stage targeted fraud and mid-stage technical attacks to later-stage money laundering, each stage is handled by specialized teams. They utilize encrypted communication tools and offshore company networks to build a cross-border collaborative organizational system, forming a closed-loop model of "headquarters command + regional execution + global money laundering."

The Bybit exchange hack in February 2025 became a landmark event in large-scale transnational criminal activities. Furthermore, the Chen Zhi case involving the Southeast Asian Prince Group, which came to light in the fourth quarter, further revealed the "industry coverage + global money laundering" characteristics of such criminal networks. This "corporate criminal ecosystem" poses significant challenges to traditional judicial cooperation and regulatory mechanisms in terms of response speed and technological capabilities.

2.1 Guarantee platforms become a major channel for collusion between black and gray industries.

In black and gray market transactions, the lack of mutual trust between the transacting parties is one of the core pain points, which directly led to the emergence of the "guarantee" intermediary role. Such guarantee platforms are essentially transaction models involving third-party guarantors (including individuals, intelligent programs, or service providers). Their core function is to assume intermediary guarantee responsibilities throughout the entire transaction process, establishing trust between the transacting parties and thereby facilitating cooperation.

As a new type of platform facilitating black and gray market activities, escrow platforms have experienced exponential growth in both user base and capital volume in recent years. Beosin statistics show that as of December 15, 2025, mainstream escrow platforms had over 549,400 users who had deposited funds over the years, with over 2.54 million deposits and a total deposited capital flow exceeding 15 billion USDT. In 2025 alone, mainstream escrow platforms had over 330,000 users, over 1.26 million deposits, and a deposited capital flow exceeding 8.7 billion USDT. Currently, escrow platforms primarily operate through anonymous chat software (such as Telegram), providing one-stop, comprehensive services to black and gray market activities by creating groups and related channels.

In 2025, the United States intensified its sanctions against cybercrime in Southeast Asia. In May, the US announced sanctions against Funnull Technology Inc. and its executives in the Philippines for involvement in virtual asset scams; in October, sanctions were imposed on the Prince Group in Cambodia and 146 related individuals, freezing and seizing 127,271 bitcoins (worth approximately $15 billion at the time), and formally severing the ties between the Huiwang Group and the US financial system; in November, sanctions were imposed on organizations in Myanmar involved in online fraud. This series of sanctions forced Southeast Asian criminal organizations, represented by Huiwang Guarantee, to cease operations or relocate.

2.1.1 Huiwang Guarantee

Among the guarantee platforms, the most representative is "Huiwang Guarantee" (renamed "Haowang Guarantee" in October 2024 to evade regulatory scrutiny), formerly belonging to the Huiwang Group. The Huiwang Group, formerly known as Huiwang Currency Exchange (Cambodia) Co., Ltd., claimed to have been established in August 2014 and was a large financial group with multiple financial licenses, including payment, banking, and insurance. Backed by the Huiwang Group, Huiwang Guarantee rapidly developed into the largest guarantee platform on Telegram, employing a three-tiered structure of "General Group - Regional Groups - Business Groups." The General Group was controlled by 10 core administrators, regional groups were divided according to business type (including "Entertainment Funds Guarantee Group," "Payment Exchange Guarantee Group," etc.), and business groups were private groups for one-on-one client interaction.

In addition to Telegram, the escrow platform also receives inquiries about large orders through chat software such as WhatsApp and Tudou. Settlement is required to be made using virtual currencies such as USDT and TRX, and direct transactions with fiat currency are refused.

As of May 2025, Huiwang Guarantee had 9,289 active public groups on Telegram, each with approximately 1,000 to 5,000 members, and was associated with 12,000 private business groups, of which "entertainment funding matching groups" accounted for 23%.

In mid-May 2025, Huiwang Guarantee was blocked by Telegram, and the platform announced its cessation of operations. The direct cause of the Telegram ban was likely US sanctions. On May 1, 2025, the US Treasury Department's Financial Crimes Enforcement Network (FinCEN) announced that it had designated Huiwang Group as a "Priority Foreign Financial Institution of Money Laundering Concern" and intended to add it to the "311" list. Being added to the "311" list would cut off access to the US dollar settlement system, meaning Huiwang Group would be unable to complete US dollar transactions through the US financial system. Furthermore, exchanges and wallet service providers, as well as other blockchain operators, would also be unable to provide services to it.

2.1.2 Potato Guarantee

Huiwang Guarantee's business was suspended due to the banning of its core Telegram group, and it urgently needed external connections to maintain operations. To quickly resume operations, Huiwang Guarantee adopted a dual-binding strategy of "equity linkage + business takeover":

● Equity Linkage

By directly acquiring a 30% stake in "Tudou Guarantee," and gaining direct access to the company through shareholding, the company avoided regulatory sensitivity caused by directly restarting the original brand, while also ensuring the continued development of its guarantee business.

● Business Acceptance

After completing the equity acquisition, Huiwang Guarantee immediately guided users of the original platform to Tudou Guarantee and other related platforms, essentially continuing the original business logic of Huiwang Guarantee.

● On-chain address information

As of December 15, 2025, the annual turnover of the address where Huiwang Guarantee was deposited was 1.995 billion USDT. As can be seen from the chart below, affected by the Telegram ban in May 2025, the turnover of Huiwang Guarantee funds declined significantly and continued to shrink.

In 2025, the total number of active addresses on the Huiwang Guarantee Chain exceeded 400,000, while the number of active addresses on Tudou Guarantee exceeded 120,000. In December, affected by the operational status of Huiwang Payment, the inflow of funds to the guarantor addresses decreased significantly. Previously, Huiwang Payment had used Tudou Guarantee's guarantor addresses for fund laundering, further confirming the connection between Huiwang and Tudou Guarantee. Referring to the chart below, since Huiwang Guarantee was blocked in May 2025, the inflow of funds to Tudou Guarantee's guarantor addresses has increased significantly.

2.2 Analysis of Money Laundering Methods Using Virtual Assets

As a result of the deep integration of blockchain technology and financial innovation, virtual assets play a positive role in improving the efficiency of the financial system, stimulating market innovation, and strengthening inclusive financial services. However, it cannot be ignored that their inherent anonymity, ease of cross-border circulation, and decentralization also provide fertile ground for money laundering, illegal fundraising, and other illegal activities, posing serious challenges to judicial practice. Currently, the number of virtual asset money laundering cases and the amount of money involved are both on the rise, with increasingly sophisticated methods, directly threatening the order and security of the financial market.

2.2.1 Stablecoin money laundering

The current trend of stablecoins diversifying across multiple currencies is significant, and the money laundering scenarios for different stablecoins vary considerably. The following are representative stablecoin cases from this year:

● USDT remains a "basic money laundering vehicle"

USDT remains a top choice for money laundering crimes. In the "Xinkangjia Financial Pyramid Scheme Case" exposed in July 2025, the platform used stablecoins as a payment method and transferred 1.8 billion USDT to a shell company in the Cayman Islands via a mixer 48 hours before its collapse, leaving the whereabouts of many investors' funds unknown. USDT on the TRON network (TRC20-USDT) has become a preferred choice for small-amount, high-frequency transfers in illicit activities such as telecommunications fraud due to its high throughput and low transaction fees.

● USDC becomes a "cross-border transition channel"

USDC is increasingly being used for money laundering following hacking attacks. After the Cetus Protocol was hacked in May 2025, 3.27 million USDC were quickly exchanged for 1,089 ETH via cross-chain protocols, with the cross-chain operation taking an average of only 17 minutes.

● DAI becomes a "powerful tool to circumvent data freezes"

DAI, with its decentralized nature, has become a stablecoin option for evading freezing sanctions. Because there is no single issuer in control, freezing assets involved in such cases is extremely difficult. Of the $840 million in DeFi assets stolen this year by the North Korean hacking group Lazarus, over 30% was laundered by converting USDC to DAI through the MakerDAO ecosystem.

● Niche cryptocurrencies like A7 and A5 have become "exclusive tools for circumventing sanctions."

This currency, backed by Russian institutions, is specifically designed to provide cross-border payment services for sanctioned entities, and has transferred a total of $70.8 billion since its launch in January 2025.

2.2.2 Money laundering using privacy/coin mixing and other tools

Cross-chain bridges, coin mixers, and privacy chains (such as Monero and Zcash) are playing an increasingly important role in money laundering pathways involving virtual assets. Hackers, fraud groups, and other organizations use these tools to rapidly transfer funds, obfuscate transaction paths, and increase the difficulty for law enforcement agencies to trace transactions.

2.2.3 Money laundering through online gambling platforms

Unlicensed gambling platforms utilize virtual assets to achieve rapid and anonymous fund settlements. Online gambling platforms (especially illegal platforms operating across borders) are "heavy users" of virtual assets. These platforms typically do not accept direct deposits of fiat currency, but instead require users to exchange fiat currency for stablecoins or mainstream virtual assets before transferring them to a designated address on the platform. Settlement and withdrawals of gambling funds are all completed using virtual assets. These funds may be exchanged between cryptocurrencies, transferred across borders, or withdrawn back to fiat currency, ultimately integrating into the legitimate economic system. This operation not only conceals the source of criminal proceeds but also increases the difficulty for law enforcement agencies to track and combat them, effectively forming a complete black market supply chain from gambling to money laundering.

3. Conclusion

In 2025, the virtual asset industry is at a critical juncture, deeply intertwined with the systematization of regulation, the specialization of crime, and technological innovation. The shift in global regulation from vague exploration to the formation of clear rules has not only cleared legal obstacles for traditional financial institutions entering the virtual asset market but also made the boundaries between compliant and illegal markets increasingly clear, propelling the virtual asset industry towards a more standardized and transparent direction. The transnational and industrialized upgrading of virtual asset crime has made it difficult for single-region regulation and enforcement to cope with the complex criminal landscape, making global regulatory cooperation and law enforcement assistance a trend in anti-money laundering efforts.