Cryptocurrency-related fraud losses hit record highs last year, thanks in part to AI tooling and sophisticated Asian crime networks, according to Chainalysis.
The blockchain analytics company said in a blog post yesterday that it observed at least $14bn in digital currency winding its way to criminals last year, versus $13bn in 2024. However, it expects the figure for 2025 to increase to $17bn once it identifies more illicit wallets in the coming months.
This is already a record high, with the value of individual scam payments also surging, by 253% year-on-year (YoY) to $2764 in 2025.
A big driver of these figures is the use of impersonation tactics, which grew 1400% in volume YoY while related payments increased over 600%. Chainalysis highlighted the E-ZPass phishing campaign from the Chinese “Smishing Triad” gang and a multimillion-dollar Coinbase operation as examples of the growing threat posed by this category of crypto fraud.
However, in general, tactics are beginning to blur to the point where traditional scam types are less distinct, the report claimed. Many romance baiting (aka pig butchering) and investment scams might include elements of impersonation, as well as social engineering, and technical- or wallet-focused tactics, it said.
Read more on crypto fraud: SEC Charges Crypto Firms in $14m Investment Scam
AI is also playing a growing role in the fraud ecosystem, and for good reason. Scams with on-chain links to AI vendors extract $3.2m per operation versus $719,000 for those without a link – which is 4.5 times more revenue, Chainalysis claimed.
“These metrics suggest both higher operational efficiency and potentially broader victim reach,” it explained.
“The increased transaction volume indicates that AI is enabling scammers to reach and manage more victims simultaneously, a trend consistent with the industrialization of fraud we’ve been tracking. In contrast, the increased scam volume suggests that AI is likewise making scams more persuasive.”
This industrialization is manifest not just in the commercialization of more sophisticated tools, but also the professionalization and specialization of distinct actors. Chainalysis has observed:
- Developers that supply phishing software and templates
- Data brokers who sell targeted lists of potential victims
- Spammers who offer tools to send fraudulent text messages at scale
- Thieves who specialize in monetizing stolen sensitive information
- Administrators who run online recruitment and collaboration forums
Although the Huione Guarantee marketplace has effectively now been shuttered thanks to its severing from the US financial system, similar operations have expanded across Asia to fuel fraud, the report warned.
“Our research shows that pig-butchering networks across Southeast Asia, drawing heavily on CMLNs [Chinese money laundering networks], generate billions of dollars annually and rely on layered wallet structures, exchanges, shell companies, and informal banking channels to launder funds and convert crypto into real-world assets, including real estate and luxury goods,” it claimed.
Law Enforcement Fights Back
That’s not to say the scammers are getting things all their own way. The report also pointed to some wins for law enforcement in 2025, including the November conviction of fraud kingpin Zhimin Qian.
She was sentenced in Southwark Crown Court to over 11 years behind bars after orchestrating a multibillion-pound investment fraud campaign that victimized over 100,000 people between 2014 and 2017. Her capture also led to the world’s largest seizure of cryptocurrency (61,000 bitcoin currently valued at over $5bn). Her accomplice Seng Hok Ling received a five-year term for his role in laundering the cryptocurrency.
In the US, prosecutors unsealed charges against Prince Group chairman Chen Zhi for allegedly overseeing Cambodian forced-labor scam compounds. The US authorities also made arrests across global money laundering networks and worked to seize and forfeit more than $15bn in proceeds linked to scam activity.
As fraud methodologies continue to evolve, Chainalysis argued the best hope for investigators is to take a “multi-pronged” response based around:
- Preventing victim harm, including greater adoption of real-time fraud and mule detection systems by financial institutions
- Enhanced cross-border law enforcement coordination to facilitate rapid fund tracing and freezing
- International support for capacity building and technical assistance
