The world’s top financial crime watchdog is sounding the alarm: crypto crime is spiraling, and governments aren’t keeping up.
On Thursday, the Financial Action Task Force (FATF), a Paris-based global regulator, called on nations to urgently tighten oversight of crypto assets. While some progress has been made since 2024, FATF says much of the crypto world still operates in a regulatory Wild West.
Only 40 out of 138 jurisdictions are “largely compliant” with FATF’s crypto standards as of April 2025—a modest improvement from 32 the year before.
Why the concern? FATF points out that illicit crypto wallets received up to $51 billion in 2024 alone, according to data from Chainalysis. And because cryptocurrencies cross borders instantly, failure in one country can ripple across the entire global financial system.
“Virtual assets are inherently borderless,” FATF warns. “Regulatory failures in one jurisdiction can have global consequences.”
Adding to the anxiety is the rising misuse of stablecoins—cryptocurrencies tied to fiat currencies—by bad actors. The report highlights use by terrorist groups, drug traffickers, and even North Korea, which the FBI says was behind a record-breaking $1.5 billion crypto theft from exchange ByBit earlier this year. Pyongyang, as usual, denies everything.
This latest warning echoes growing concern from other global regulators. In April, the EU’s top securities agency also flagged crypto’s growing entanglement with traditional finance as a threat to systemic stability.
Bottom line: as crypto becomes more mainstream, the pressure is on. FATF is urging all nations to close the loopholes before billions more disappear into digital shadows.