As the United States and other countries consider building national cryptocurrency reserves, new research from Chainalysis suggests that governments may already be within reach of tens of billions of dollars of potentially recoverable on-chain assets – a development that could intersect with these discussions about reserves.
In a report released Thursday, Chainalysis estimates that crypto balances linked to illicit activities exceed $75 billion. This total includes approximately $15 billion held directly by illicit entities and more than $60 billion in portfolios exposed downstream to these entities.
The blockchain analytics company said darknet market operators and providers control over $40 billion in crypto assets on the blockchain.
Around 75% of the total illicit value is held in Bitcoin (BTC), although stablecoins represent a growing share of this activity.
Chainalysis linked its findings to the US Trump administration’s creation of a strategic Bitcoin reserve and digital asset stockpile. These initiatives aim to expand federal crypto holdings through budget-neutral meanswhich may include asset confiscations.
“[T]The cryptocurrency ecosystem presents law enforcement with an unprecedented opportunity: billions of dollars of illicit proceeds sit on public blockchains and are theoretically seizable if authorities can coordinate their action,” the report said.
Chainalysis co-founder and CEO Jonathan Levin said Bloomberg that these figures take “the potential for asset confiscation to a completely different level,” adding: “It changes the way countries think about this.” »
Elsewhere, Canadian authorities recently seized approximately $40 million in digital assets from TradeOgre, a cryptocurrency exchange accused of operating without registration and facilitating money laundering. This action drew heavy criticism from members of the crypto community, who argued that the move exceeded regulatory limits.
Related: Bybit Hacker Launders 100% of $1.4 Billion Stolen Crypto in 10 Days
Blockchain Transparency Distorts Perception of Crypto Crime
As crypto crime has increased in recent years, including several high-profile hacks targeting major exchanges and service providers, its overall scale remains small.
According to Chainalysis Crypto Crime Report 2025illicit transactions accounted for just 0.14% of all blockchain activity in 2024, a figure that continues a downward trend from previous years.
In contrast, the United Nations Office on Drugs and Crime (UNODC) estimates that 2 to 5% of global GDP is laundered through traditional financial systems.
Analysts say one reason crypto crime attracts disproportionate attention is the transparency of blockchain networks, where every transaction is publicly traceable. This visibility makes illicit activities easier to detect and therefore more reported than crimes involving cash or conventional banking systems.
As a relatively new technology, the crypto ecosystem has also faced scrutiny of regulation and law enforcementamplifying perceptions of widespread wrongdoing.
Related: Blockchain security must be localized to stop Asia’s crypto crime wave
