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Suspected Human Trafficking Networks See 85% Rise in Crypto Payments in 2025
Cryptocurrency flows to services linked with suspected human trafficking surged 85% year over year in 2025.
The findings come from a new report by blockchain analytics firm Chainalysis, which highlighted that the intersection of cryptocurrency and suspected human trafficking expanded markedly last year.
Which Crypto Assets Are Most Used in Suspected Human Trafficking Networks?
The report outlined four primary categories of suspected crypto-facilitated human trafficking. This includes Telegram-based “international escort” services, forced labor recruitment linked to scam compounds, prostitution networks, and child sexual abuse material vendors (CSAM).
“The intersection of cryptocurrency and suspected human trafficking intensified in 2025, with total transaction volume reaching hundreds of millions of dollars across identified services, an 85% year-over-year (YoY) increase. The dollar amounts significantly understate the human toll of these crimes, where the true cost is measured in lives impacted rather than money transferred,” Chainalysis wrote.
According to the report, payment methods varied across categories. International escort services and prostitution networks used stablecoins.
“The ‘international escort services are tightly integrated with Chinese-language money laundering networks. These networks rapidly facilitate the conversion of USD stablecoins into local currencies, potentially blunting concerns that assets held in stablecoins might be frozen,” Chainalysis noted.
Human Trafficking Service Inflows by Asset Type. Source: Chainalysis
CSAM vendors have historically relied more heavily on Bitcoin (BTC). However, Bitcoin’s dominance has declined with the rise of alternative Layer 1 networks.
In 2025, while these networks continue to accept mainstream cryptocurrencies for payments, they increasingly turn to Monero (XMR) to launder proceeds. According to Chainalysis,
“Instant exchangers, which provide rapid and anonymous cryptocurrency swapping without KYC requirements, play a crucial role in this process.”
The Dual Role of Crypto in Human Trafficking-Linked Transactions
Chainalysis noted that the surge in cryptocurrency flows to services linked with suspected human trafficking is not occurring in isolation. Instead, it mirrors the rapid expansion of Southeast Asia–based scam compounds, online casinos and gambling platforms, and Chinese-language money laundering (CMLN) and guarantee networks operating primarily through Telegram.
Together, these entities form a fast-growing regional illicit ecosystem with global reach. According to the report, Chinese-language services operating across mainland China, Hong Kong, Taiwan, and multiple Southeast Asian countries exhibit advanced payment processing capabilities and extensive cross-border networks.
Furthermore, geographic analysis reveals that while many trafficking-linked services are based in Southeast Asia, cryptocurrency inflows originate globally. Significant transaction flows were traced to countries including the United States, Brazil, the United Kingdom, Spain, and Australia.
“While traditional trafficking routes and patterns persist, these Southeast Asian services exemplify how cryptocurrency technology enables trafficking operations to facilitate payments and obscure money flows across borders more efficiently than ever before. The diversity of destination countries suggests these networks have developed sophisticated infrastructure for global operations,” the report read.
At the same time, Chainalysis stressed that blockchain transparency offers investigators deeper visibility into trafficking-related financial activity.
Unlike cash transactions, which leave little to no audit trail, blockchain-based transfers generate permanent, traceable records. This creates new opportunities for detection and disruption that are not possible with traditional payment systems.
Where Are Crypto Venture Capital Funds Investing in Early 2026?
As capital flows sharply out of the crypto market in early 2026 and investor sentiment remains at extreme fear levels, venture capital allocation decisions have become a valuable signal. These moves help retail investors identify sectors that may still hold potential during a bear market.
Recent reports indicate that the crypto market environment has changed. The sectors attracting VC funding have shifted accordingly.
VCs Invest Over $2 Billion in Crypto in Early 2026
Data from CryptoRank shows that venture capital firms have invested more than $2 billion into crypto projects since the beginning of the year. On average, weekly inflows have exceeded $400 million.
Crypto Fundraising in Early 2026. Source: CryptoRank
Several large deals stand out. Rain raised $250 million to build enterprise-grade stablecoin payment infrastructure. BitGo secured $212.8 million through its IPO, reinforcing its role as a digital asset custodian and security provider for institutional clients.
BlackOpal also raised $200 million for its GemStone product, an investment-grade vehicle backed by tokenized Brazilian credit card receivables.
Top Funding Rounds For Crypto VCs in Early 2026. Source: Alex Dulub
Beyond these deals, Ripple invested $150 million in trading platform LMAX. The move supports the integration of RLUSD as a core collateral asset within institutional trading infrastructure. Tether also made a $150 million strategic investment in Gold.com, expanding global access to both tokenized and physical gold.
Analyst Milk Road notes that capital is no longer flowing into Layer 1 blockchains, meme coins, or AI integrations. Instead, stablecoin infrastructure, custody solutions, and real-world asset (RWA) tokenization have emerged as the dominant investment themes.
Market data supports this shift. Since the start of the year, total crypto market capitalization has fallen by roughly $1 trillion. In contrast, stablecoin market capitalization has remained above $300 billion. The total value of tokenized RWAs has reached an all-time high of over $24 billion.
What Does the Shift in VC Appetite Signal?
Ryan Kim, founding partner at Hashed, argues that VC expectations have fundamentally changed. The shift reflects a new investment standard across the industry.
In 2021, investors focused on tokenomics, community growth, and narrative-driven projects. By 2026, VCs will prioritize real revenue, regulatory advantages, and institutional clients.
“Notice what’s absent? No L1s. No DEXs. No ‘community-driven’ anything. Every dollar went to infrastructure and compliance,” Ryan Kim stated.
The largest deals listed above involve infrastructure builders rather than token-driven projects designed to generate price speculation. As a result, the market lacks the elements that previously fueled hype cycles and FOMO.
“Not on speculation. Not on hype cycles. They’re looking at the pipes, rails, and compliance layers,” analyst Milk Road said.
However, analyst Lukas (Miya) presents a more pessimistic view. He argues that crypto venture capital is in a state of collapse, citing a sharp, sustained decline in limited partner commitments.
He points to several warning signs. High-profile firms such as Mechanism and Tangent have shifted away from crypto. Many firms are quietly unwinding their positions.
It may still be too early to declare the collapse of crypto VC, given that more than $2 billion has flowed into the sector since the start of the year. At a minimum, these changes suggest that crypto is integrating more deeply with the traditional financial system, a potential sign of long-term maturation.
Praetorian Group Revelations Closely Mirror FTX Executive-Level Failures in $200 Million Crypto F...
The US DOJ (Department of Justice) has secured a 20-year prison sentence against the founder of a sprawling crypto investment scheme.
According to prosecutors, this scheme had defrauded more than 90,000 investors worldwide of over $200 million.
DOJ Exposes and Dismantles $200 Million Bitcoin Ponzi as Founder Receives 20-Year Prison Term
In a statement released on Thursday, the DOJ confirmed that Ramil Ventura Palafox, 61, was sentenced after pleading guilty to wire fraud and money laundering charges.
Palafox was the founder, chairman, and CEO of Praetorian Group International (PGI), a multi-level marketing company that claimed to generate outsized returns through Bitcoin trading and crypto-related strategies.
According to court documents, PGI operated from December 2019 to October 2021, raising more than $201 million from investors worldwide. The company promised daily returns of 0.5% to 3%, marketed as profits from sophisticated Bitcoin arbitrage and trading activities.
In reality, investigators found PGI was not conducting trading at the scale required to generate such returns. Instead, it functioned as a classic Ponzi scheme, using funds from new investors to pay earlier participants.
Authorities said at least $30.2 million was invested in fiat currency, alongside 8,198 Bitcoin valued at approximately $171.5 million at the time of investment.
Confirmed losses reached at least $62.7 million, though prosecutors indicated the total financial harm could be significantly higher.
Lavish Lifestyle and Fabricated Profits: How Palafox Hid the Collapse Behind a Luxury Facade
To maintain the illusion of profitability, Palafox allegedly created and controlled an online investor portal that displayed fabricated account balances.
Between 2020 and 2021, the platform consistently misrepresented investment performance. It falsely showed steady gains and reinforced investor confidence even as the scheme unraveled behind the scenes.
Court filings detail how Palafox diverted substantial amounts of investor funds to finance a lavish personal lifestyle.
According to prosecutors, he spent roughly $3 million on 20 luxury vehicles. He also spent approximately $329,000 on penthouse accommodations at a luxury hotel chain and purchased four residential properties in Las Vegas and Los Angeles worth more than $6 million.
Additional expenditures included around $3 million on designer clothing, jewelry, watches, and home furnishings from high-end retailers.
Prosecutors further alleged that Palafox transferred at least $800,000 in fiat currency and 100 Bitcoin—then valued at approximately $3.3 million—to a family member.
The scheme began to collapse in mid-2021 after PGI’s website went offline and withdrawal requests mounted. Although Palafox resigned as CEO in September 2021, authorities said he initially retained control over company accounts.
Prosecutors described this case as one of the more significant crypto-related Ponzi schemes in recent years. The sentencing marks a decisive conclusion to a scheme that thrived on exaggerated crypto profits and global recruitment networks.
Parallels with FTX: How PGI Echoed a Larger Crypto Collapse
Despite differences in scale and sophistication, this case is similar in many ways to the FTX collapse and associated contagion. Both exploited the crypto boom, promising investors outsized, unrealistic returns:
Palafox with daily Bitcoin gains of 0.5–3%,
FTX through high-yield exchange products tied to Alameda Research.
Investor funds were misappropriated for lavish personal spending:
Palafox on luxury cars, real estate, and designer goods
SBF on Alameda’s risky bets, properties, and political donations.
Both schemes used deceptive methods to maintain investor confidence:
PGI with a fake portal showing steady gains
FTX with hidden liabilities and inflated valuations.
PGI defrauded over 90,000 investors with confirmed losses exceeding $62.7 million, while FTX affected millions and billions in missing funds.
Federal prosecutions followed, with Palafox sentenced to 20 years in February 2026 and SBF to 25 years in 2024.
All these highlight a trend among bad actors in crypto while also revealing the DOJ’s ongoing crackdown on crypto-related fraud.
El Salvador’s Bitcoin Conviction Now Carries a $300 Million Price Tag
Bitcoin’s (BTC) bear market has weighed heavily on investors across the spectrum. Corporate treasuries, major whales, and even nation-state holders have all felt the pressure.
The cryptocurrency’s slide has slashed the value of El Salvador’s holdings as credit default swaps rise to a five-month high, raising concerns over the country’s IMF program and debt outlook.
El Salvador’s Bitcoin Bet Under Pressure as Portfolio Drops
According to the latest data from El Salvador’s Bitcoin Office, the country’s Bitcoin reserves stand at 7,560 BTC, worth approximately $503.8 million. Bloomberg reported that the portfolio’s value has fallen from around $800 million at Bitcoin’s October 2025 peak, marking a drop of nearly $300 million in just four months.
El Salvador’s Bitcoin Holdings. Source: El Salvador Bitcoin Office
Bukele, an ardent Bitcoin advocate, has continued purchasing one Bitcoin per day. However, this strategy increases the country’s exposure to market volatility.
In contrast, Bhutan recently sold $22.4 million worth of Bitcoin. The divergent strategies of El Salvador and Bhutan reflect fundamentally different risk philosophies.
Bhutan’s Bitcoin mining operations generated more than $765 million in profit since 2019. However, the 2024 Bitcoin halving significantly increased mining costs, compressing margins and reducing returns. Bhutan now appears to be liquidating part of its holdings, while El Salvador continues to prioritize long-term accumulation.
Nonetheless, the country has also diversified its portfolio. Last month, it spent $50 million to acquire gold as demand for the safe-haven metal rose amid macroeconomic tensions.
IMF Loan Talks Face Strain Over El Salvador’s Bitcoin Policy
El Salvador’s deepening commitment to cryptocurrency has impacted relations with the International Monetary Fund. The government’s continued Bitcoin purchases, combined with delays in implementing pension reforms, have complicated the country’s IMF agreement.
The Fund has expressed concern about Bitcoin’s potential impact on fiscal stability. A disruption to the IMF program would weaken one of the key supports behind El Salvador’s sovereign debt recovery. Over the past three years, the country’s bonds have returned more than 130%, making them one of the standout turnaround stories in emerging markets.
“The IMF may take issue with disbursements potentially being used to add Bitcoin. Bitcoin being down also doesn’t help to ease investors’ concerns,” Christopher Mejia, an EM sovereign analyst at T Rowe Price, told Bloomberg.
The IMF approved a 40-month Extended Fund Facility on February 26, 2025, unlocking about $1.4 billion in total, according to official IMF documentation. The first review ended in June 2025, with $231 million disbursed.
However, the second review has remained on hold since September, following the government’s delay in publishing a pension system analysis. During that period, El Salvador continued to add to its Bitcoin reserves despite repeated warnings from the IMF.
A third review is scheduled for March, with each review tied to additional loan disbursements.
“The continued purchase of Bitcoin, in our view, does create some potential challenges for the IMF reviews. The market would react quite poorly if the anchor provided by the IMF were no longer present.” Jared Lou, who helps manage the William Blair Emerging Markets Debt Fund, said.
Meanwhile, bond markets are signaling rising concern over El Salvador’s fiscal outlook. Credit default swaps have climbed to a five-month high, reflecting increasing investor anxiety about the country’s repayment capacity.
According to data compiled by Bloomberg, El Salvador faces $450 million in bond payments this year, with obligations increasing to nearly $700 million next year.
El Salvador’s Bitcoin policy now sits alongside key fiscal and IMF negotiations. The outcome of upcoming IMF reviews and the country’s bond repayment schedule will play a significant role in shaping investor confidence and the sustainability of its debt trajectory.
Coinbase Users Hit Temporary Crypto Roadblock Just Before Q4 Earnings Release
Some Coinbase users are currently experiencing a temporary disruption, leaving them unable to buy, sell, or transfer digital assets on Coinbase.com.
The issue, first reported by the platform on social media, has prompted concern among traders, though the company reassures customers that all funds remain secure.
Temporary Service Disruption Leaves Coinbase Users Unable to Trade
Coinbase, the largest US-based crypto exchange, confirmed the disruption in a statement on its official Twitter support channel, noting:
“We are aware that customers may be unable to buy, sell, or transfer on Coinbase.com at this time. Our team is investigating this issue and will provide an update. Your funds are safe,” the exchange shared in a post.
The company emphasized that the outage is temporary and that there is no indication of any long-term risk to user accounts or funds. Updates will be provided as the investigation progresses.
Community trackers and crypto news accounts, including MilkRoad, quickly picked up the report, echoing Coinbase’s statement.
While the cause of the disruption has not yet been disclosed, Coinbase’s quick acknowledgment reflects the platform’s growing focus on transparency amid increased scrutiny of crypto exchange reliability.
Temporary outages on exchanges, though relatively rare, can have ripple effects on trading activity and market sentiment, especially for high-volume users or during periods of heightened market volatility.
Some users have expressed frustration on social media, noting that being unable to execute trades temporarily could affect active positions. However, such disruptions are often resolved quickly and typically do not result in financial loss.
Coinbase Q4 Earnings In Focus
The incident comes ahead of Coinbase’s earnings report, with the exchange scheduled to release its Q4 2025 and full-year 2025 financial results today, Thursday, February 12, 2026, after market close (US time).
The market sentiment ahead of Coinbase earnings is predominantly cautious to bearish in the short term, driven by expectations of a sequential decline in key metrics amid softer crypto trading volumes, lower asset prices, and broader market weakness.
Analysts at Monness, Crespi, Hardt have also downgraded COIN stock amid predictions that Coinbase will struggle to meet Q4 earnings forecasts.
The downgrade reflects ongoing issues in digital asset trading and reduced visibility in near-term financial performance.
As of this writing, COIN stock was trading for $140.31, down by over 45% year-to-date. While revenue is likely to lag, long-term prospects remain intact.
Ethereum Sitting In The “Opportunity Zone“ Is Still Struggling At Price Recovery
Ethereum price remains under pressure after a sharp decline that unsettled investors across the crypto market.
Although Ethereum appears to be entering a historically favorable accumulation zone, on-chain indicators reveal mixed conviction among different holder cohorts.
Ethereum Is In a Prime Accumulation Range
Ethereum’s Market Value to Realized Value, or MVRV, ratio indicates that ETH has entered what analysts describe as an “opportunity zone.” This range lies between negative 18% and negative 28%. Historically, when MVRV falls into this band, selling pressure approaches exhaustion.
Previous entries into this zone often preceded price reversals. Investors typically accumulate when unrealized losses deepen. Such behavior can stabilize the Ethereum price and initiate recovery phases. However, historical probability does not guarantee immediate upside.
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Ethereum MVRV Ratio. Source: Santiment
Current macro conditions complicate the outlook. Liquidity constraints and cautious sentiment may delay accumulation. While MVRV suggests undervaluation relative to realized cost basis, broader market weakness could suppress momentum and extend consolidation before any meaningful rebound begins.
Ethereum Holders Are Leaning Differently
Short-term holders are regaining influence over Ethereum price action. The MVRV Long/Short Difference measures profitability between long-term and short-term holders. Deeply negative readings signal greater profitability among short-term holders compared to long-term investors.
Toward the end of January, the metric suggested profitability was shifting away from short-term traders. That trend hinted at an improving structure. However, the recent decline reversed that dynamic, restoring short-term holder profits. These investors typically sell quickly, increasing vulnerability to renewed downside pressure.
The HODLer net position change metric reveals another shift. Long-term holders previously exhibited steady accumulation. In recent days, the buying pressure has transitioned into distribution, reflecting reduced confidence among strategic investors.
Long-term holder selling adds structural risk. These participants often provide foundational support during downturns. Without renewed accumulation from this cohort, the Ethereum price may struggle to absorb supply. Current data shows limited evidence of strong counterbalancing demand.
Ethereum HODLer Net Position Change. Source: Glassnode ETH Price May Look At Consolidation
Ethereum price trades at $1,983 and remains above the $1,811 support level. Despite this stability, the altcoin recently marked a nine-month low at $1,743. Maintaining $1,811 is critical to prevent deeper technical deterioration.
Given ongoing selling from both short-term and long-term holders, recovery may face resistance near $2,238. Continued weakness could keep ETH trading closer to support rather than challenging overhead barriers. A confirmed breakdown below $1,811 may expose Ethereum to $1,571.
Ethereum Price Analysis. Source: TradingView
Alternatively, reduced selling from short-term holders could ease pressure. If long-term holders resume accumulation, Ethereum may attempt a stronger rebound. A decisive move above $2,238, followed by a rally past $2,509, would invalidate the bearish thesis and improve the medium-term outlook.
LINK Stuck Near 6-Year Support Despite Major Partnerships With Robinhood and Ondo
Chainlink (LINK), one of the leading oracle platforms, has struggled to find a recovery throughout February. Despite multiple pieces of positive news, selling pressure has remained persistent.
As price action reaches a support level that has held for six years, February could be the decisive moment for LINK to enter a new price phase.
Positive Developments in February Fail to Offset Selling Pressure
Price data shows that the current level around $8.4 aligns with a long-term support trendline that has held since 2020. This makes LINK’s price behavior in the coming days a key reference point for analysts when forming longer-term projections.
Recent signals from strategic partnerships could, in theory, strengthen LINK’s appeal.
Robinhood has launched a public testnet for Robinhood Chain, a Layer 2 network on Arbitrum designed for tokenized assets. More importantly, Chainlink serves as the platform’s oracle provider. The integration allows developers to leverage Chainlink’s data feeds, interoperability, and compliance standards to support advanced tokenization use cases.
Similarly, Ondo Finance, a platform focused on tokenized real-world assets, has selected Chainlink as its official data provider. The goal is to accelerate the adoption of tokenized stocks and ETFs. This collaboration enables tokenized U.S. securities to operate across Ethereum’s DeFi ecosystem, secured by institutional-grade data.
“Using Chainlink, DeFi protocols can now price Ondo Global Markets assets with best-in-class accuracy, manage positions safely, and provide users with more protection during volatile market conditions,” Ondo Finance stated.
The benefits from the Robinhood and Ondo partnerships have not translated into an immediate price increase. Weak overall market sentiment appears to be the main constraint. LINK showed no clear rebound from the six-year support level when these announcements were released.
On another front, exchange-side selling pressure has intensified. Exchange Inflow (Top 10) rose sharply in February 2026.
This metric measures the total amount of coins from the top 10 inflow transactions to exchanges. Elevated values indicate that large volumes of LINK are being deposited at once. This behavior often signals rising sell-side pressure.
A similar spike occurred in September last year. LINK’s price began to decline shortly afterward. The metric has now started rising again. This trend may suggest that some large holders are preparing to liquidate, adding to downward price pressure.
Sustained selling pressure could push LINK below its six-year support. However, partnerships with Robinhood and Ondo still provide long-term optimism. A meaningful recovery will likely require a more favorable market environment to align with Chainlink’s underlying fundamentals.