About 11 percent of illicit cryptocurrency transaction volume in 2025 was seized or frozen through cooperation between law enforcement agencies and private-sector groups. The industry is holding this up as a case that challenges the perception that crypto is well suited for hiding crime, but controversy continues over how the statistics are calculated and what they cover.

On May 16, blockchain outlet Cryptopolitan reported that Binance Research said in a recent report that about 11 percent of illicit crypto transaction volume was recovered this year. Binance argued the recovery rate was about 55 times higher than the recovery rate for traditional financial assets.

The report stressed that capabilities to trace and recover cryptocurrencies are being strengthened rapidly. It presented cases involving Tether, Interpol and the T3 Financial Crime Unit as key evidence.

A leading example cited was the work of the T3 Financial Crime Unit. The group, a cooperative body jointly established by stablecoin issuer Tether, blockchain network Tron and blockchain analytics firm TRM Labs, said it has frozen more than $450 million worth of USDT linked to crime since its launch in September last year. The frozen funds included money tied to money laundering, North Korea-linked cyber operations, drug trafficking and violent crimes such as kidnapping. The T3 group said the amount blocked this year increased 43.9 percent from last year.

Cross-border cooperation cases also continued. In Spain, it supported efforts to freeze about $26.4 million in funds linked to a European money-laundering network, and it helped freeze 4.3 million USDT in Brazil federal investigative authorities' Operation Lusocoin. The investigation was reported to have led to the seizure of assets totaling 3 billion Brazilian reais, or about $525 million.

After the Bybit hacking incident, flows of about $9 million linked to funds leaked from an exchange were also identified. More recently, Tether froze 344 million USDT on the Tron network.

The Financial Action Task Force also assessed the T3 Financial Crime Unit early this year as "a very valuable resource to law enforcement agencies around the world".

Questions have also been raised over the statistics presented by Binance. On the day in November last year when the International Consortium of Investigative Journalists released 'The Coin Laundry', Binance published its own transparency report and claimed that "direct exposure to illicit funds has fallen 96 percent since early 2023". It also said the share of total transaction volume directly connected to illicit wallets was only 0.007 to 0.023 percent.

But blockchain analytics firm Chainalysis kept some distance from Binance's interpretation. Chainalysis said it did not conduct the analysis directly, and pointed out that Binance's figures did not include all categories of illicit activity that it tracks. It said stolen funds from hacks and ransomware proceeds were excluded, in particular.

TRM Labs also raised a similar issue. Ari Redbord (아리 레드보드), head of policy, said the statistics Binance attributed to the firm reflected "only certain categories". He also drew a line on comparisons with rival exchanges, saying those were not within the scope of the firm's analysis.

Binance also acknowledged it did not include all categories of illicit activity in its analysis. The company said, "Different methodologies are needed for each category, and there are differences in how data providers handle them."

Meanwhile. Binance pleaded guilty in November 2023 to allegations of anti-money laundering and sanctions violations in the United States and is currently implementing a three-year compliance monitoring programme. At the time, U.S. government penalties totaled $4.3 billion.

The U.S. Treasury has since demanded submission of materials from the compliance monitoring programme over allegations that more than $1 billion in cryptocurrency moved through Binance to Iran-linked groups.

In the market, there is an assessment that the statistics show advances in technology to trace and recover crypto crime. It also highlighted that market perceptions can change depending on what data exchanges present and how they present it.