Crypto crime rises as $75B in illicit funds remain trapped on-chain: Report

Blockchain adoption has reached a record high, with crypto usage increasingly accepted across the board. The rising usage, however, has led to an increase in bad actors, driving a surge in on-chain illegal activity.  $75 billion in illicit crypto remains on-chain According to Binance Research, the total volume of illicit funds stuck on-chain skyrocketed to $75 billion. The rise marks a 28% increase from 2024 levels and the highest value in crypto history.  The massive jump in funds stuck on-chain suggests that launderers have failed to successfully convert and launder their loot. Although illicit transactions are on the rise, these funds only account for 1% of the total on-chain volume. However, the growth in illicit on-chain funds reflects stubborn problems in the industry driven by theft, ransom, and fraud.  In essence, the research noted that the increase doesn't reflect increased criminal activity; rather, it's driven by large heists and laundering attempts.  Improved security and transparency block criminals from cashing out Despite the rise in illicit funds, it has become increasingly difficult for these bad actors to convert crypto into fiat.  The diminishing ability to launder illicit funds mostly arises from rising security levels. Firstly, KYT flags suspicious wallets during transaction monitoring, often before funds enter exchanges.  Equally, the use of KYC improved security by limiting withdrawals at the exchange level. Also, stablecoin issuers freeze suspected funds, while law enforcement agencies continue to seize suspected funds.  In 2026, for example, TRM Labs reported that the U.S. DOJ and FBI seized more than $112 million in proceeds from crypto crimes. Finally, even the crypto mixers have substantial limitations. The largest crypto mixers process only $10 million per day, implying it takes 100 days to mix $1 billion. The limitation gives room for investigation and potential seizures. Finally, on-chain transactions leave a permanent record, making it easy to track these funds. Thus, even with 80% of the illicit funds having moved from primary to secondary addresses, it's still easy to track. Is transparent blockchain the answer to rising criminality? The $75 billion in illicit funds shows that crypto crime remains extremely high. 2026 so far has proven true to this fact, with crypto hacks and exploits becoming rampant. Barely halfway into 2026, the crypto market has seen over $813 million in exploits, with April alone accounting for $634 million. This suggests that criminals continue to advance and improve in their tactics. However, the rising security measures and cooperation between agencies and crypto firms give hope for the future. The limited ability of criminals to cash out underscores the importance of transparency in the crypto industry. This is because transparent technology is gradually becoming hostile to illicit finance. As a result, crypto has delivered greater transparency than TradFi, as between 2% and 5% of global GDP is laundered annually. Final Summary The total volume of illicit funds stuck on-chain jumped to a new all-time high of $75 billion.  Rising transparency has limited the ability of bad actors to successfully launder the loot, emphasizing the need for a more transparent blockchain technology.