A Binance Research analysis found that more than $75 billion in illicit crypto funds remain visible and traceable on-chain. The report said blockchain records are making laundering harder, even as criminal balances have continued to grow since 2016.
According to the findings, illicit crypto activity still makes up less than 1% of total transaction volume. However, balances linked to crime have increased as fewer assets move successfully through laundering channels.
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Illicit Crypto Funds Face Tighter On-Chain Tracking
Binance Research said the figure rose another 28% in 2025 compared with 2024. The firm said the problem is becoming structural for bad actors because blocked balances are staying on-chain.
Compliance systems are taking on a bigger role in restricting exits, according to the report. Know Your Transaction tools warn of flagged wallets, while Know Your Customer checks block off-ramp access for risky users.
When wallets are flagged as criminal, stablecoin issuers also assist in restricting movement. Freezing tools and direct law enforcement seizures have made laundering more difficult, Binance Research said.
It added that the immutable blockchain makes it easier for investigators to follow illicit crypto funds through multiple address wallets. Even if the assets themselves leave that original wallet linked to crime, each transfer stays on-chain.
More than 80% of illicit crypto funds are no longer sitting in the first wallet associated with a crime, according to Binance Research. Although these assets usually flow into downstream wallets, the traces of transactions can still be seen.
The report also indicated that traceability does not end with the first address. The ledger records every movement, and investigators can trace later transfers.
Privacy Tools Fail Against Illicit Crypto Funds
Binance Research also challenged privacy tools in big cyber-heists. It claimed that Wasabi Wallet and CryptoMixer together have an aggregated daily volume of nearly $10 million.
That capacity is still relatively small in comparison to big crypto hacks. It claimed that a thief would require more than 100 days to pull off a $1 billion heist on any of those platforms.
These findings are in line with the data from Chainalysis for October 2025. The report estimated that over $75 billion in illicit crypto assets had been held within wallets directly or indirectly associated with crimes.
The firm also discovered that over $40 billion was associated with operators and sellers in darknet markets. Almost 75% of all illicit balances came from Bitcoin, while stablecoins and Ether kept on gaining ground.
The Binance Research analysis came after the exchange outlined its anti-scam AI systems. In Q1 of 2026 alone, Binance claims over 100 AI models thwarted approximately 22.9 million scam attempts and assisted in securing the accounts of over 5.4 million users throughout the year.
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