Traditional informal financial networks operating on the hawala principle are increasingly being used to launder money through cryptocurrencies, including stablecoins, according to a new report by the Financial Action Task Force (FATF). The authors note that illicit banking is transforming into "digital hawala."
A survey was conducted in 46 jurisdictions, and nearly 70% of respondents noted the adoption of new technologies by informal networks. The growing trend towards using "digital hawala" includes the use of encrypted messengers, promotion on social media, and a reduced reliance on cash.
Clients of illicit banking are increasingly making bank transfers, using fintech apps or instant payment systems, crypto platforms, as well as stablecoins. The latter are used to reduce volatility, FATF noted.
"In more advanced models, operators use virtual assets, including stablecoins such as USDT, USDC, and DAI, to replace or complement traditional methods for settlements. These mechanisms can include fast transfers, conversion to cash, or hybrid combinations," the report states.
Over 80% of survey respondents classified systems like hawala as key channels or methods for professional money laundering. The adoption of digital tools could increase the efficiency of this activity, facilitate the concealment of funds, and expand the geographic reach of networks, the authors believe.
FATF has already called for better oversight of stablecoins, releasing a 40-page report in March on the risks of such tokens and their peer-to-peer transfers without regulated intermediaries. The document noted that stablecoins accounted for up to 84% of illicit crypto transactions in 2025. It was separately emphasized that transfers between private non-custodial wallets create a vulnerability, bypassing anti-money laundering systems.
During the preparation of the Russian law "On Digital Currencies and Digital Rights," which came into force, the Bank of Russia repeatedly emphasized that the regulation of the crypto market is being developed precisely taking into account FATF recommendations.
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