Crypto Money Laundering: How Criminals Move Illicit Funds and How to Spot It

When people talk about crypto money laundering, the process of disguising illegally obtained cryptocurrency to make it appear legitimate. Also known as cryptocurrency obfuscation, it’s not science fiction—it’s happening right now, with over $21 billion in illicit funds moving through blockchain bridges in 2025 alone. Unlike traditional banking, crypto doesn’t require ID checks or paper trails. That’s why bad actors love it. They use mixers, tumblers, and cross-chain swaps to break the link between a wallet and its criminal origin. Once the coins hop from Ethereum to Solana to BSC, tracing them gets messy—even for experts.

One of the most common tricks? Fake exchanges like VB Crypto Exchange, a network of scams posing as legitimate trading platforms. These platforms let users deposit stolen crypto, then withdraw it as "clean" funds after a few fake trades. Another favorite is exploiting poorly monitored cross-chain bridges, tools designed to move assets between blockchains. These bridges are fast, cheap, and often unregulated. In 2025, they became the top pipeline for laundering ransomware payments and dark web proceeds. Even legit platforms like QuadrigaCX, Canada’s largest former crypto exchange that collapsed due to fraud were used as fronts—users lost $215 million because no one checked where the money came from.

It’s not just about shady exchanges. DeFi protocols, stablecoin swaps, and even airdrop scams are being twisted into laundering tools. Take DFX Finance, a niche decentralized exchange on Polygon for swapping non-USD stablecoins. It’s meant for international business, but criminals use it to convert stolen USDT into EUR-backed tokens, then cash out through peer-to-peer networks. The same goes for fake tokens like Trisolaris (TRI), a token with zero trading volume that’s been used to create phantom liquidity. No one trades it, but it shows up on ledgers as "proof" of activity.

Here’s the ugly truth: if a crypto project has no team, no audits, and no real users—but suddenly has high trading volume—it’s probably being used to clean dirty money. The same goes for tokens that spike after an airdrop, like Flourishing AI (AI), a token that crashed 88% after a single MEXC distribution. No tech, no community, just a pump-and-dump fueled by laundered cash.

What’s next? More regulation won’t fix this alone. You need to know where to look. That’s why the posts below dig into real cases—how scams like HB.top and Spice Trade hide behind fake legitimacy, how VPNs help launderers bypass geo-blocks, and why even "safe" stablecoins can be weapons in this game. You won’t find fluff here. Just the facts on how crypto money laundering works, who’s behind it, and how to avoid getting caught in the crossfire.