International finance watchdog warns stablecoins are increasingly used in sanctions evasion and money laundering

In its latest report, the global standard setter FATF said stablecoins now account for the bulk of illicit crypto activity and pose growing risks through peer-to-peer transfers. What to know : The Financial Action Task Force warned that stablecoins are now the most widely used virtual asset in illicit transactions, including by actors in Iran and North Korea, and called for stricter oversight of issuers. Recent analyses by FATF, Chainalysis and TRM Labs found that stablecoins accounted for the vast majority of illicit crypto transaction volume in 2024 and 2025, with tens of billions of dollars tied to fraud, scams and sanctions evasion. FATF urged countries to impose anti-money laundering rules on stablecoin issuers, address risks from peer-to-peer transfers via unhosted wallets, and consider tools such as wallet freezing and restrictions on certain smart-contract functions as the market surpasses $300 billion.