TRM Labs: Stablecoin Volume Soars to Trillions While Illicit Flows Remain Concentrated
TRM Labs’ 2025 analysis finds stablecoin activity surged, with multiple months exceeding $1 trillion in transaction volume and stablecoins accounting for roughly 60% of all crypto transaction volume. Over a 12‑month period, tens of trillions of dollars moved through stablecoins as use shifted from predominantly trading to payments and settlement by retail and institutional users. TRM reports approximately $141 billion of stablecoin-linked transfers to illicit entities in 2025, with 86% of illicit crypto flows tied to sanctions evasion. Illicit exposure is highly concentrated in a small number of sanctioned exchanges, payment services and networked platforms, and processed largely via coordinated high‑risk wallets, front companies and intermediary services. TRM argues that because risk clusters in identifiable networks visible on public blockchains, targeted, intelligence‑led interventions can reduce illicit activity without broadly restricting lawful stablecoin use. Key figures: multiple months > $1 trillion stablecoin volume, stablecoins ≈ 60% of crypto volume, ~$141 billion received by illicit entities, 86% of illicit flows related to sanctions evasion.
Neutral
The report highlights robust, broad-based growth in stablecoin usage—multiple months above $1 trillion and stablecoins representing ~60% of crypto transaction volume—which signals stronger utility demand for payments and settlement beyond speculative trading. That is a positive structural signal for on-chain liquidity and trading volumes. However, TRM also shows illicit flows are present (~$141 billion) and concentrated in a small set of high‑risk networks, with sanctions evasion accounting for 86% of illicit crypto flows. Because illicit activity is concentrated and visible on public blockchains, the report suggests targeted enforcement rather than sweeping regulatory bans. For traders this is neutral overall: increased stablecoin use supports liquidity and reduces frictions (potentially bullish for short‑term execution and altcoin pairs priced in stablecoins), while concentrated illicit risk raises regulatory scrutiny toward specific entities or rails (which can trigger episodic selloffs if major platforms are sanctioned or frozen). Historical parallels: prior episodes where illicit activity concentrated on a few exchanges led to targeted enforcement actions that caused short‑term volatility (e.g., actions against specific OTC desks or sanctioned services). In the long term, clearer surveillance and targeted enforcement can improve market integrity and institutional confidence, which is bullish structurally. In the short term, expect localized volatility around implicated platforms and heightened due diligence by counterparties.