Summary
Laws are outpacing enforcement: While jurisdictions are increasingly adopting necessary regulations — from Travel Rule legislation to VASP licensing regimes — enforcement is lagging. The FATF’s message is unambiguous: the grace period for paper-only compliance is over.
Freeze-resistant stablecoins are an emerging threat: Criminal networks are now issuing their own stablecoins — marketed as immune to asset freezing — specifically to undermine the programmable controls regulators have been counting on. The FATF flags this as a “significant and emerging risk.”
Crime is converging and scaling with AI: Organised crime, fraud, DPRK proliferation financing, terrorist financing, and sanctions evasion are increasingly sharing infrastructure. AI is accelerating every stage, from deepfake-powered identity fraud to automated attacks on blockchain-based financial applications.
Blockchain analytics is a regulatory baseline: The FATF’s recommendations to the private sector explicitly list wallet screening, blacklisting/whitelisting, blockchain analytics tools, and freezing/blocking capabilities as expected components of a compliant AML/CFT framework.
