Understanding the Controversy Around Stablecoins and Crime
Stablecoins have become a focal point of discussions in the crypto world. Recently, a New York Times (NYT) report faced critical backlash for its assertion that stablecoins are increasingly a tool for criminal activities and sanctions evasion. Experts, including Jake Chervinsky, CLO of Variant Fund, have called it a “hit piece,” arguing that the article overstated the risks associated with cryptocurrency, particularly stablecoins.
What the NYT Report Claimed
The NYT report claimed that over $25 billion worth of illicit funds were moved through stablecoins in 2024, citing data from Chainalysis. Furthermore, the report highlighted a shift in criminal preference from Bitcoin (BTC) to stablecoins due to their dollar-linked nature and deep liquidity. In a bold conclusion, the NYT suggested that stablecoins undermine the U.S.’s ability to enforce sanctions and regulate international financial flows.
The Industry’s Response
According to experts like Jake Chervinsky, these claims lack sufficient nuance. While it’s true stablecoins have seen increased adoption within illicit flows (accounting for 63% in 2024), the broader context shows that cryptocurrency-related illicit activity makes up a mere 0.14% of total global criminal activity. Compare this to traditional finance, where the volume of illicit fund activities dwarfs that of crypto-based transactions.
Leaders in the stablecoin sector, such as Tether, are spearheading efforts to combat illegal use. Through the Tether-led T3 Financial Crime Unit, $300 million worth of criminal funds were frozen in 2025 alone, with a total of over $3 billion blocked to date. These actions prove that sanctions enforcement remains feasible, even in the decentralized world of blockchain.
Rising Crypto Hacks: A Growing Concern
While stablecoins are scrutinized, the broader cryptocurrency market is grappling with a surge in hacks and thefts. Data from Peckshield reveals that crypto hacks in 2025 have already reached $3.25 billion, up 8.2% from 2024 and a staggering 24% higher than 2023 figures. November saw a sharp spike in hacks, with an alarming $194 million stolen in a single month following incidents like the Balancer breach.
The largest theft of 2025 to date occurred in February with the Bybit exchange hack. These events underline the urgent need for tighter security measures within the cryptocurrency space to prevent criminals from exploiting vulnerable platforms.
The Future of Stablecoins and Crypto Regulation
As the adoption of cryptocurrencies continues to grow, it’s imperative for both regulators and industry leaders to strike a balance between innovation and security. Stablecoins, in particular, hold immense potential to modernize finance but also present risks that need addressing to ensure global financial stability.
If you’re a crypto enthusiast or investor looking to safeguard your digital assets, consider investing in secure cold storage wallets, such as the Ledger Nano X. This highly acclaimed product can help protect your funds from online hacks and unauthorized access.
