Crypto’s big growth on the books and in the shadows - marketplace-tech Recap

Podcast: marketplace-tech

Published: 2026-02-12

Duration: 11 minutes

Guests: Ari Redbord

Summary

Cryptocurrency usage is expanding, with legitimate applications growing faster than illicit ones. However, the rise in illegal uses, including sanctions evasion and scams, highlights the dual nature of this financial technology.

What Happened

Cryptocurrency is increasingly being used for illegal transactions, with $158 billion involved in illicit activities last year, marking an all-time high according to TRM Labs. Despite this, legitimate uses of crypto are growing at a faster rate, as financial institutions and exchanges expand their involvement in the crypto space.

Ari Redbord from TRM Labs highlights the use of stablecoins on a large scale, both for lawful payments and for evading sanctions, particularly by nation-states like Russia and Venezuela. The report identifies a Russia-related stablecoin, A7A5, as a significant driver of illicit activity due to its use in sanctions evasion.

Sanctions-related crypto activity increased by over 400% last year, posing a challenge to existing financial regulations that rely on the dominance of the U.S. dollar. Cryptocurrency offers a way to bypass these systems, allowing funds to move outside traditional financial networks swiftly.

The episode discusses the concept of a 'shadow economy' emerging alongside the legitimate crypto market, driven by both lawful and illicit uses of stablecoins. This duality underscores the complexity of regulating cryptocurrency effectively.

Scams are a significant issue, with $35 billion lost to various fraud schemes last year, comparable to previous years. One notable scam type is 'pig butchering', where scammers build trust with victims over time before defrauding them.

Work-from-home scams are also prevalent, offering fake job opportunities that entice victims to pay fees for non-existent earnings. These scams are often long-term operations, making them difficult to detect and prevent.

AI is increasingly being used in scams, with a 500% rise in AI-enabled fraud. This technology allows scammers to create personalized attacks using deepfake videos and targeted messaging, enhancing the effectiveness of their schemes.

Key Insights

• $158 billion in cryptocurrency was used for illegal activities last year, setting a record high. But : legitimate crypto transactions are growing even faster, as big financial players dive deeper into the crypto pool.
• Russia-related stablecoin A7A5 is dodging sanctions in a big way, contributing to a 400% spike in sanctions-related crypto activity. This shadow economy is challenging traditional financial systems that rely on the U.S. dollar's dominance.
• Scammers made off with $35 billion last year using schemes like 'pig butchering,' where they fatten up their mark's trust before the big heist. It's a modern twist on the long con that's proving hard to stamp out.
• AI-fueled scams have skyrocketed by 500%, using deepfakes and tailored messages to personalize fraud at an unprecedented scale. It's like a digital chameleon, adapting and evolving to fool even the savviest of us.