$16.1 Billion in Illicit Crypto Traced to Chinese-Language Networks in 2025

Chainalysis reported on January 27 that Chinese-language money laundering networks processed $16.1 billion in illicit cryptocurrency during 2025, emerging as one of the largest facilitators of global crypto-related financial crime. 

The findings appear in a preview chapter of the firm’s upcoming 2026 Crypto Crime Report and show these networks now drive roughly 20% of known on-chain laundering activity worldwide.

Source: Chainalysis

The report highlights a sharp expansion in the broader illicit crypto economy, which grew from about $10 billion in 2020 to more than $82 billion in 2025. 

Chainalysis data shows that Chinese-language networks alone handled an average of $44 million per day last year, reflecting both deeper crypto liquidity and a shift away from centralized exchanges, where funds are more likely to be frozen.

Scam, Hacking, and Fraud Funds Drive Network Growth

Chainalysis discovered that inflows to known Chinese language money laundering networks have increased thousands of times faster than flows into centralized exchanges, decentralized finance networks, or direct wallet-to-wallet connections since 2020.

Frauds, scams, and hacking, as well as organized fraud, such as pig-butchering schemes, have become more and more absorbed by these networks.

Over 1,799 on-chain wallets were operational, and these services have been associated with over 2025 operations in 2025, a significant growth compared to a few years ago.

Source: Chainalysis

Other types of services grew at a fast pace, and after less than a year, they had hit the $1 billion volume capacity per transaction. Black U services, dedicated to working with tainted crypto assets, have reached such a limit within only 236 days, highlighting how fast such systems can grow.

Source: Chainalysis

Tom Keatinge, a Centre for Finance and Security at RUSI expert, has attributed this growth to capital controls in China, which have resulted in deep liquidity pools that are being utilized by both money movers and criminal organizations.

Chris Urben, an Nardello & Co expert, has pointed out that crypto has largely replaced traditional informal banking mechanisms because of faster cross-border transactions with minimal manual processes involved.

Guarantee platforms serve as escrow centers for the exchange of laundered services, with players like Huione and Xinbi facilitating the marketing of services by vendors and helping them build trust.

Source: Chainalysis

Despite the crackdown on the platforms, the vendors have been able to switch to other platforms, and Chainalysis indicates that the operations are conducted on an industrial scale and through various methods.

Six Core Crypto Laundering Service Categories Identified

In the report, there are six main categories of core services, which include running point brokers, money mules, OTC desks, Black U services, gambling platforms, and crypto swapping or mixing services.

Collectively, they simulate the traditional money laundering phases, including placement, layering, and integration, only at high speed and magnitude.

Black U and gambling-linked automated operations completed transactions of large amounts of money within minutes, and manual networks dependent on money mules displayed a lower and slower variation. Chainalysis observed that big-value transfer is always given priority, irrespective of the type of service.

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