A new report from a Paris-based watchdog shows that while some countries have made progress in regulating cryptocurrencies since last year, many still aren’t doing enough to curb the risks involved. As of April 2025, only 40 out of 138 countries evaluated meet most of the standards set by the Financial Action Task Force (FATF) for crypto regulation. This is a slight improvement from 32 countries in 2024.
The FATF warns that because virtual assets like cryptocurrencies operate across borders, weak rules in one place can cause problems worldwide. In 2024, illicit crypto wallets may have received as much as $51 billion, according to blockchain analysis firm Chainalysis. The watchdog also pointed out that many countries struggle to figure out who is behind virtual asset transactions, making it easier for criminals to hide.
Concerns about crypto risks are growing. In April, the European Union’s securities watchdog mentioned that the expanding crypto market might threaten the overall financial system, especially as it becomes more connected with traditional finance.
The FATF highlighted stablecoins—cryptocurrencies tied to regular money—as a major concern. These coins are often used by criminal groups, including North Korean operatives, terrorists, and drug traffickers. Most illegal activities in crypto now involve stablecoins.
Adding to these worries, the FBI said North Korea was behind a massive crypto theft in February. The country allegedly stole about $1.5 billion worth of virtual assets from the crypto exchange ByBit, marking the largest theft of its kind. North Korea denies any role in hacking or crypto-related crimes.
Overall, while there’s progress in setting some rules for crypto, many countries still need to step up to better control the risks that come with these fast-moving, borderless digital assets.