Federal authorities in the United States and elsewhere over the past year have moved to interrupt the laundering of billions in cryptocurrency stolen through myriad global cyberscam operations, from nation-state fraud schemes to virtual romance and similar financial scams.

The U.S. Treasury Department last year targeted the Huione Group, a Cambodian conglomerate whose various subsidiaries are accused of helping to launder illicit crypto for North Korean-linked threat groups and other criminal entities, by designating it as a primary laundering concern, sanctioned The Prince Group – another Cambodian conglomerate – and released an advisory outlining the activities of such Chinese operations.

In November 2025, the U.S. Justice Department announced a Scam Center Strike Force to focus on shutting down operations around the world.

Researchers with blockchain platform provider Chainalysis, noting the growing attention such money laundering operations have gotten in recent months, detailed the stunning growth and reach of Chinese laundering networks over the past few years.

“These money laundering networks operate openly across various platforms and demonstrate complex, multi-layered operations characterized by industrial-scale processing capacity, operational resilience, and technical sophistication,” the researchers wrote in a recent report.

Laundered $16 Billion in 2025

The Chinese-language money laundering networks (CMLNs) emerged during the Covid-19 pandemic, growing from its start in 2020 to laundering almost 20% of all illicit crypto funds from scammers and other cybercriminals around the world, according to Chainalysis, which estimates that $82 billion of cryptocurrency was laundered on-chain last year.

Of that, CMLNs laundered $16.1 billion last year, an average of $44 million a day. The flow of illicit crypto into these networks over between 2020 and 2025 grew 7,325 times faster than those to centralized exchanges, 1,810 times faster than those to decentralized finance (DeFi), and 2,190 times faster than intra-illicit on-chain flows.

Active entities that make up these entities also has exploded, from a handful a few years ago to more than 1,799 active on-chain wallets in 2025.

“While CMLNs are by no means the only facilitator of on-chain laundering, Chinese-language Telegram-based services now account for a disproportionate share of the attributed global on-chain money laundering landscape,” the researchers wrote. “In doing so, they process funds from a wide range of on- and off-chain criminal activity.”

Six Service Types

They identified six discrete service types in the CMLN ecosystem, from Black U, which openly launder crypto stolen in scams, to running point brokers (which are initial entry channels for illicit funds) to money mules, which take illicit crypto into their accounts and then transfer it to others. The Chainalysis researchers noted the scale and speed of these services, writing that it can take from 236 days (for Black U) to 1,790 days (for money movement networks) to process $1 billion in ill-gotten crypto.

“These networks’ rapid time-to-scale suggests they are tightly interwoven with off-chain criminal networks, as growth of this magnitude would be hard to achieve without significant capital pools put into play,” they wrote. “It also reveals a sophisticated on-chain and off-chain operational infrastructure. At the center of this ecosystem sit guarantee platforms — centralized marketplaces that have become the anchor for CMLN operations.”

Guarantee services are third-party intermediaries that are found on Telegram and similar platforms that ensure the trustworthiness and security of the transactions between the bad actors the laundering networks. Huione and Xinbi are at the top of the guarantee services ladder, though Huione was affected when Telegram shut down some of its channels last year.

Crypto Feeding the Growth of CMLNs

Chris Urben, managing director at global investigations firm Nardello & Co told Chainalysis said changes in China’s embrace of cryptocurrency is helping to fuel the growth of CMLNs.

“The biggest change in Chinese money laundering networks in recent years is a rapid transition to crypto from reliance on informal value transfer systems like the traditional Black Market Peso or Fei Qian approaches to underground banking,” Urbe said. “Crypto offers an efficient way to discreetly move funds across borders without having to rely on the complex manual network of informal ledgers in various countries that used to be the norm.”

The scale and integration of the various operations that make up the CMLNs make them a formidable challenge to break down, one that will require a coordinated approach that includes public entities and private organizations, the researchers wrote. In addition, initiatives need to target the networks themselves, not just their advertising venues.

China Isn’t the Only Player

They also noted that while the Chinese operations have an outsized influence in crypto laundering, they’re not the only players, pointing to the UK’s National Crime Agency’s takedown in late 2024 of a multi-billion-dollar Russian-language laundering network.

Tom Keatinge, director at the Centre for Finance and Security at the Royal United Services Institute, told Chainalysis that “there is a chasm in most countries between the capabilities of criminals and law enforcement when it comes to crypto use. A combination of nationally-based laws, barriers created by borders, poor information sharing, and limited crypto tracing and asset recovery capabilities mean that crypto offers criminals a low risk/high reward method of benefiting from their criminality.”

Blockchain companies like Chainalysis and Elliptic are doing good work “a systemic global effort to upskill the crypto capabilities of law enforcement around the world and create better information sharing mechanisms is urgently needed,” Keatinge said.