FATF Warns of Rising Stablecoin-Related Crimes, Calls for Enhanced Regulation

According to PANews, the Financial Action Task Force (FATF) has issued a warning about the increase in crimes related to stablecoins. However, executives from blockchain intelligence firms argue that this is not a threat to the cryptocurrency industry but rather a call for stronger regulation and monitoring. Executives from Chainalysis and Asset Reality suggest that the warning aims to promote unified licensing and regulation for stablecoin issuers, enhance real-time monitoring, and foster international cooperation to track and combat illegal fund flows, rather than prohibiting the development of stablecoins. Data from Chainalysis indicates that in 2025, 63% of on-chain illegal transaction volume was denominated in stablecoins. Experts highlight that the transparency and traceability of stablecoins make them less ideal for criminals. Centralized stablecoin issuers also have the capability to freeze illicit funds, as demonstrated by Tether, which once froze $225 million in USDT linked to criminal activities. Additionally, blockchain investigator ZachXBT noted that Circle's USDC was used by North Korean IT workers for payment activities, criticizing Circle for not taking sufficient measures to detect or freeze such activities. Previously, Circle had frozen $57 million in USDC following a U.S. court order.