Chinese crypto laundering networks move billions through digital assets

A new Chainalysis report reveals how sophisticated Chinese-language money laundering networks used cryptocurrency, Telegram-based channels and stablecoins to funnel billions in illicit funds globally, highlighting growing challenges for law enforcement and regulators.

Chinese-language money laundering networks routed an estimated $16.1 billion in illicit funds through cryptocurrency transactions in 2025, underscoring the growing scale and sophistication of crypto-enabled financial crime, according to a new report by blockchain analytics firm Chainalysis.

The study found that these networks—referred to as Chinese-Language Money Laundering Networks (CLMNs)—accounted for nearly 20 percent of the global illicit cryptocurrency economy last year. Chainalysis estimates total illegal crypto activity in 2025 exceeded $82 billion, driven by organised crime, scams and sanctioned actors seeking to bypass traditional financial systems.

Telegram channels at the core of illicit deals

Chainalysis noted that CLMNs largely operate through Mandarin-language channels on Telegram, where laundering services are openly marketed. These channels frequently showcase images of large cash holdings and testimonials from past clients to signal credibility and liquidity.

Often described as “guarantee platforms,” these Telegram groups act as informal marketplaces or escrow-style connectors between buyers and sellers of illicit services. While the platforms themselves may not directly handle funds, they serve as critical coordination points for criminal transactions.

According to Chainalysis, activity on these channels extends well beyond money laundering. Investigators have observed links to human trafficking operations, online scam centres in Southeast Asia, and the sale of satellite internet equipment used in fraudulent compounds. Clients reportedly include organised crime syndicates as well as sanctioned state-linked entities.

Stablecoins, casinos and regional crime hubs

Cryptocurrencies—particularly stablecoins such as USDT and USDC—have become the preferred tools for these networks due to their liquidity, price stability and perceived anonymity. Analysts said stablecoins reduce volatility risk during laundering, allowing criminals to preserve value while paying fees for illicit financial services.

Experts also point out that crypto laundering is frequently combined with traditional methods. Casinos, both licensed and underground, remain a common channel for recycling illegal proceeds by inflating revenues or masking transaction origins.

Southeast Asia has emerged as a key base for such operations, with countries like Cambodia and Myanmar hosting scam centres and casinos linked to transnational crime. While China has banned cryptocurrency trading and enforces strict anti-money laundering laws, criminal groups have increasingly shifted operations offshore to exploit weaker regulatory environments.

Chainalysis estimates that CLMNs laundered roughly $44 million every day in 2025. Despite intensified crackdowns, analysts warn these networks remain highly adaptive, rapidly shifting platforms and tactics to evade detection as enforcement efforts increase.