Crypto Crime Costs $158B in 2025 Even as Illicit Crypto Use Declines
TRM Labs reports that crypto-related crime caused estimated losses of $158 billion in 2025, while overall illicit use of cryptocurrencies continued a multi-year decline. The figure includes theft, fraud, scams, darknet markets and sanctioned activity; TRM notes that the $158B tally partly reflects value fluctuations and the inclusion of historic cases rather than all newly criminal proceeds in 2025. Key trends: illicit activity as a share of total crypto value has fallen, law enforcement actions and sanctions enforcement are rising, and better on-chain analytics and compliance tools are reducing misuse. TRM highlights persistent threats from scams and thefts and warns that state actors and sanctioned entities still exploit crypto rails. For traders: the report underscores continued regulatory and enforcement scrutiny, evolving risk around specific fraud vectors, and potential volatility when enforcement actions or large recovered/tainted balances move on-chain.
Neutral
The report combines a very large headline loss figure ($158B) with evidence that illicit use as a share of total crypto activity is declining. For markets this is neutral overall: the large dollar figure can spook retail sentiment and trigger short-term volatility, especially around tokens linked to hacked funds or sanctioned entities. At the same time, stronger enforcement and improved compliance tools reduce systemic illicit flows, which is positive for long-term institutional adoption and price stability. Historical parallels: large crime tallies (e.g., major exchange hacks) caused short-term sell-offs and regulatory attention, but long-term markets recovered as compliance improved. Traders should expect short-term volatility driven by enforcement news, asset-specific risk when tainted funds move, and gradual reduction in darknet-driven demand—supporting a neutral medium-term outlook with episodic bearish shocks.