Home » Crypto News Share: Share: The Senate Banking Committee voted 15-9 on Thursday to move forward on the CLARITY Act, a crypto market structure proposal that has been the subject of debate for a while now. Nevertheless, just ahead of the vote, the Bank Policy Institute (BPI) put out a series of tweets on X about illicit crypto flows hitting $154 billion in 2025, adding another dimension to what was already an intensely debated topic on the extent of regulation in digital assets. The timing of BPIâs thread drew attention because lawmakers were simultaneously debating amendments tied to stablecoin yield restrictions and enforcement standards inside the CLARITY Act markup session.
According to data from Chainalysis that the institute shared, in 2025, illicit crypto addresses received $154 billion. This was a 162% year-over-year increase, driven largely by a 694% jump in value received by sanctioned entities. Furthermore, the on-chain money laundering ecosystem grew from $10 billion in 2020 to over $82 billion in 2025, with stablecoins, primarily Tether (USDT), now accounting for 84% of all illicit transaction volume, displacing Bitcoin as the preferred payment method for criminals.
In a separate piece, the BPI argued that banks have spent decades staffing tens of thousands of AML employees while crypto companies have been largely exempt. It said that the GENIUS Act imposed some obligations on US stablecoin issuers, but did not cover foreign issuers operating stateside. Tether, incorporated in El Salvador, sits outside that net.
- Why Ethena Just Recorded Its Biggest Network Growth in Over Three Months - CLARITY Act Faces Wave of Amendments Ahead of Markup - Crypto Burglar âGothFerrariâ Sentenced After $250M Theft Ring Targeted US Victims The piece also cited the Islamic Revolutionary Guard Corps, whose crypto activity reportedly reached over $3 billion in 2025, representing roughly 50% of Iranâs total crypto ecosystem by Q4 of that year. â The stablecoin debate has become one of the most contentious parts of the CLARITY Act negotiations, with banking groups, including members of the American Bankers Association, spending weeks lobbying senators to tighten language restricting yield-bearing stablecoins. 5 million times in support of the bill.
But despite more than 40 amendments proposed by Senator Elizabeth Warren and procedural disputes during the hearing, the legislation advanced with support from Democratic senators Ruben Gallego and Angela Alsobrooks. While the BPI is demanding stricter anti-money laundering laws and sanctions regulations to be applied to crypto the same way it has been done to the traditional banking sector, data shared by Binance Research on May 14, offered some pushback to its claims. According to Binance, trapped illicit funds on-chain have grown every year because less is being successfully laundered, not more.
Their report showed that more exit points are being blocked by KYC and more balances are being frozen by stablecoin issuers. Even the largest mixers have been processing at most $10 million per day.
