Reading time: 6 min
Cryptocurrency flows to suspected human trafficking operations surged 85% in 2025, reaching hundreds of millions of dollars across identified services, according to Chainalysis’ 2026 Crypto Crime Report. The growth tracks directly with the expansion of Southeast Asia’s scam compound economy — an industry the United Nations estimates generates up to $37 billion a year in losses and holds at least 220,000 people in forced labour across Myanmar and Cambodia alone.
Four Revenue Streams, One Ecosystem
Chainalysis tracked four categories of suspected crypto-facilitated trafficking: Telegram-based international escort services, labour placement agents recruiting for scam compounds, prostitution networks, and child sexual abuse material vendors. The categories operate differently but share infrastructure — particularly Chinese-language money laundering networks and Telegram-based guarantee platforms like Tudou and Xinbi, which hold cryptocurrency in escrow until transactions are confirmed.
The financial patterns are distinct. Nearly 49% of transactions linked to Telegram-based escort services exceeded $10,000 in 2025, with VIP packages advertised above $30,000. Listings reviewed by researchers offered cross-border travel, multi-day arrangements and tiered pricing structures — the kind of systematised operation that indicates agency-level control rather than independent actors. Prostitution networks clustered lower, with roughly 62% of crypto payments falling between $1,000 and $10,000. Labour recruitment fees for scam compound placements matched that range, typically $1,000 to $10,000 in cryptocurrency.
CSAM networks have evolved toward subscription-based models and increasingly use Monero to obscure transaction details. In one case identified by Chainalysis following a UK law enforcement lead, a single dark web CSAM platform used over 5,800 cryptocurrency addresses and generated more than $530,000 in revenue since mid-2022 — exceeding the crypto revenue attributed to the 2019 “Welcome to Video” case. German authorities took down KidFlix, one of the largest CSAM sites, in a separate 2025 operation.
The Laundering Layer
What ties the trafficking categories together is the money laundering infrastructure. Chinese-language money laundering networks operating through Telegram channels processed at least $16.1 billion in total illicit funds in 2025, according to Chainalysis — not all trafficking-related, but the same rails that escort services, scam compounds and CSAM vendors use to convert cryptocurrency into local currency. Funds typically flow through a combination of mainstream exchanges, institutional platforms and Telegram-based guarantee services before conversion. Chainalysis found that escort service financial flows show particularly strong integration with these laundering networks, creating compliance chokepoints at exchanges where detection and disruption become possible.
The infrastructure has a name. The U.S. Financial Crimes Enforcement Network in May 2025 designated Cambodia’s Huione Group as a primary money laundering concern, identifying it as a key conduit for North Korean hackers and Southeast Asian scam networks. Huione’s brokerage arm routed over $4 billion in criminal proceeds between August 2021 and January 2025. When affiliated Tether wallets were frozen, the group launched its own stablecoin — USDH — marketed as immune to future freezes. Blockchain forensics firm Global Ledger observed over $10 billion in Tether transaction volume flowing through Huione-linked wallets in the 47 days following the FinCEN designation, with nearly $943 million reaching major centralised exchanges. The willingness of criminal enterprises to build parallel financial rails when existing ones are disrupted is a pattern regulators across the region are now confronting.
The Human Scale
The dollar figures understate the crisis. UNODC’s April 2025 “Inflection Point” report estimated that financial losses from cyber-enabled fraud in East and Southeast Asia reached $18–37 billion in 2023. Cambodia alone generates an estimated $12.5–19 billion a year from scam operations — equivalent to as much as 60% of the country’s formal GDP, according to industry estimates compiled by the Business & Human Rights Resource Centre. At least 120,000 people are held in scam compounds in Myanmar and another 100,000 in Cambodia, according to the UN High Commissioner for Human Rights. INTERPOL data covering 2020–2025 found that 74% of known victims trafficked into scam centres were brought to Southeast Asia from around the world — including from India, where the government rescued over 550 victims in 2025, and from Pakistan, Bangladesh and sub-Saharan Africa.
Tom McLouth, the Chainalysis intelligence analyst who led the trafficking research, told Decrypt that the report represents an industry-defining moment. “I haven’t seen anyone talk about human trafficking holistically within the current crypto ecosystem,” he said. “This is real human trafficking, real sex trafficking, real labour trafficking. These are real people being affected.” The U.S. Department of Justice underscored the scale in late 2025 when it announced the seizure of bitcoin worth approximately $15 billion from a massive Cambodian scam centre running romance and cryptocurrency investment scams.
Global Customers, Regional Supply
Geographic analysis of the blockchain data reveals that while trafficking services concentrate in Southeast Asia — particularly in Cambodia, Myanmar, Laos and the Philippines — the customers are everywhere. Chainalysis tracked significant cryptocurrency payment flows originating from North and South America, Europe and Australia. The operations are run regionally but monetised globally, which is precisely what makes Telegram-plus-crypto such an effective distribution channel in an era of weakening cross-border enforcement.
UNODC’s latest reporting shows the problem is metastasising, not contracting. Crackdowns in Cambodia and Myanmar have displaced operations into Laos, the Philippines, and increasingly into the Pacific islands, Africa and Latin America. Criminal groups have acquired special economic zones, built purpose-designed business parks, and exploited citizenship-by-investment schemes in countries like Vanuatu to insulate themselves from extradition. “It spreads like a cancer,” said Benedikt Hofmann, UNODC Acting Regional Representative for Southeast Asia. “Authorities treat it in one area, but the roots never disappear; they simply migrate.”
The Paradox of Transparency
There is an irony in these numbers: they exist because blockchain transactions are traceable. Cash — still the dominant payment method for trafficking globally — leaves no trail. Chainalysis argues that cryptocurrency’s inherent transparency creates detection and disruption opportunities impossible with traditional payment methods. The firm emphasises that its estimates represent a lower bound — the true scale is likely larger, because many trafficking-linked wallets remain unidentified. But McLouth cautioned against complacency: “In general, as crypto adoption grows, its use for both illicit and legitimate purposes will increase.” The trends, he said, suggest a troubling trajectory for 2026.
For markets, the implications are regulatory. Every major jurisdiction is tightening crypto compliance rules. The question is whether exchanges and stablecoin issuers can close the laundering chokepoints Chainalysis identified — at guarantee platforms, at mainstream exchanges where funds surface before conversion — before the next iteration of criminal infrastructure renders those chokepoints obsolete. Huione’s answer to wallet freezes was to build its own blockchain. The trafficking networks’ answer to darknet takedowns was to move to Telegram. In this ecosystem, disruption is real, but so is adaptation.
Sources: Chainalysis, CNBC, Decrypt, UNODC, DL News
