USDC, a widely used regulated stablecoin issued by Circle, has increasingly become a focus of scrutiny in the United States due to its exploitation by criminals for money laundering and related financial crimes. Despite Circle’s compliance measures and the centralized ability to freeze assets, illicit actors capitalize on USDC’s rapid transferability and transnational reach to obscure the origins of fraud proceeds, circumvent traditional financial controls, and operate unlicensed currency transmission businesses. Law enforcement agencies including the DOJ, IRS-CI, and FinCEN have uncovered sophisticated laundering schemes involving millions in USDC, resulting in significant forfeitures and prosecutions. These developments expose the delicate balance between fostering innovation in digital currency and addressing the mounting challenges stablecoins pose to the US anti-money laundering framework in 2025.​
In the United States, USD Coin (USDC), while a regulated stablecoin issued by Circle, has been prominently involved in money laundering schemes tied to fraud and financial crimes. Criminals exploit USDC’s rapid digital transfer capabilities to convert illicit proceeds obtained through scams, fraud, and unlicensed money transmission into seemingly legitimate crypto assets. Despite Circle’s regulatory compliance and ability to freeze wallets, law enforcement agencies such as the DOJ, IRS-CI, FBI, and U.S. Secret Service have uncovered and seized large volumes of USDC connected to these crimes, including multi-million dollar forfeitures and prosecutions. These cases highlight the complex balance between leveraging digital stablecoins for legitimate business and the vulnerabilities they present for laundering activities. The U.S. government continues to enhance enforcement, regulatory oversight, and inter-agency cooperation to combat the misuse of USDC for money laundering in the American financial system.
