The $82 Billion Pivot
On-chain money laundering activity exploded to over $82 billion in 2025, an eight-fold increase from 2020 levels. A new Chainalysis report identifies the primary engine behind this surge: Chinese-language money laundering networks (CMLNs), which now process nearly one-fifth of all illicit crypto flows.
The data signals a structural break in crypto crime. Criminals are abandoning centralized exchanges, historically the primary off-ramp, for decentralized, specialized clearinghouses. Inflows to these CMLNs grew 7,325 times faster than illicit inflows to centralized exchanges over the last five years.
The Mechanics of “Black U”
These networks are not merely loose associations of wallets. They are industrial-scale financial service providers. Chainalysis identified $16.1 billion processed by CMLNs in 2025 alone, routed through approximately 1,800 active wallets.
The infrastructure is segmented into six specific service layers, including “money mule motorcades” and “Black U” services, providers that sell tainted USDT at a discount to clean funds. By isolating the laundering stages, these networks insulate the core operators from asset freezes.
“Chinese-language money laundering networks now consistently launder more than 10% of funds stolen through so-called pig butchering scams,” the report noted.
Institutional Context
The shift to CMLNs complicates enforcement. Unlike centralized exchanges, which are compliant with subpoena requests, these networks operate on encrypted platforms like Telegram and utilize ephemeral wallet structures. The resilience of marketplaces like Huione Guarantee, which continued operations despite U.S. sanctions, demonstrates the durability of this new laundering architecture.
