Misuse of Virtual Assets in Financial Crime

Virtual assets have become an increasingly prominent component of the global financial system, offering efficiency and expanded access to financial services, while also increasing exposure to financial crime risks. This report provides an analysis of the misuse of virtual assets (VAs) and virtual asset service providers (VASPs), based on financial intelligence and operational insights developed by the UAE Financial Intelligence Unit (UAEFIU).

The report draws on Suspicious Transaction Reports (STRs) and Suspicious Activity Reports (SARs) submitted between July 2023 and June 2025, supported by blockchain tracing, international intelligence exchange, law enforcement case analysis, and engagement with VASPs and the banking sector.

Key findings show that fraud is the most prevalent typology, alongside risks related to money laundering, online illegal gambling, sanctions evasion, and market manipulation. The analysis highlights the increasing use of stablecoins, decentralized platforms, peer-to-peer activity, and third-party (money mule) accounts to facilitate illicit transactions.

The report emphasizes the need for enhanced technology, capacity building, international cooperation, and public-private partnerships, and includes risk indicators to support the detection and reporting of virtual asset misuse.

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